Two firms have identical cost curves

Assignment Help Business Economics
Reference no: EM131379909

Two firms have identical cost curves, but firm A is a price taker while firm B is a price searcher. Is it possible that the two firms could find themselves at the same wealth maximizing output? (Assume that firm B is NOT able to engage in any form of price discrimination.) If so, explain the specific circumstances under which this would occur; if not, prove it.

Reference no: EM131379909

Questions Cloud

Assuming the industry is in long-run equilibrium : Suppose there are ten firms in a monopolistically competitive industry, each with an equal share of the market. The market demand is given as Q = 10200 – P.   Each firm has a total cost function TC = 51000 + 500q2. Assuming the industry is in long-ru..
What will be the future value of your investment : Consider a situation in which you invest 7000 SR per year for 7 year in a bank account that has an annual interest rate of 10%. What will be the future value of your investment?
Short and long-run marginal and average cost curves : How will a tax of $5 per unit produced affect the short- and long-run marginal and average cost curves? What about an annual license fee of $500 per year regardless of production level?
Producer who is attempting to maximize wealth : “A producer who is attempting to maximize wealth (or profit) will never knowingly set their output where the demand for their product is ‘inelastic.’” Refute or prove this statement. Does your answer depend on whether the producer is a price taker or..
Two firms have identical cost curves : Two firms have identical cost curves, but firm A is a price taker while firm B is a price searcher. Is it possible that the two firms could find themselves at the same wealth maximizing output? (Assume that firm B is NOT able to engage in any form of..
Make general statement about value of elasticity of demand : A price searcher faces a demand that is given by P = 100/Q. What does the Marginal Revenue curve look like (graph it). What is the value of elasticity of demand at quantities Q = 10; Q = 50; Q = 100? Can you make a general statement about the value o..
Methodologies of risk assessment : What do you think of the property of transitivity in choice theory and methodologies of risk assessment. How can we improve the ways we assess risk, or think about choices we make?
Find the best price to maximize the revenue : 6000 bottles of water are sold when the price is $3 per bottle. when the prices is $4 per bottle, 5500 are sold. find the linear price equation where the price is p(x) and x represents bottles of water. set up table of (x,y) values showing your work...
The financial crash : Discuss Daniel Kahneman’s Mckinsey interview, and the message he delivers in regards to the risk involved in using inside information (one of the persistent problems in decision theory – with numerous recent examples, including the Financial Crash of..

Reviews

Write a Review

Business Economics Questions & Answers

  Small ice cream stand on campus called ice-campusades

Imagine that you have decided to open a small ice cream stand on campus called "Ice-Campusades." You are very excited because you love ice cream (delicious!) and this is a fun way for you to apply your business and economics skills! Use your knowledg..

  What is the multiplier effect

What is the MULTIPLIER effect? How does it work? remember that we’re talking about the spending multiplier here, not the money multiplier that operates on the money and banking side of the economy)

  Distinction between good nervousness and bad nervousness

Many musicians and performers make a distinction between "good nervousness" and "bad nervousness". What do you think this distinction means? How does it apply to public speaking?

  Fill in the column society willingness to pay

Fill in the column "Society's willingness to pay." Then draw a graph of society's demand for the public good.

  Macrs depreciation allowances

A project requires $268,980 of equipment that is classified as 7-year property. What is the book value of this asset at the end of year 3 given the following MACRS depreciation allowances, starting with year one: 14.29, 24.49, 17.49, 12.49, 8.93, 8..

  Describe how capital and labor affect production function

Describe how capital and labor affect the production function for both a toy manufacturer and a retailer during the Christmas retail season. An owner of a local movie theater is having difficulty maximizing labor. Sometimes there are too many employe..

  Develop a strategy for a firm to make sure its products

Develop a strategy for a firm to make sure it’s products always stay a big step ahead of its present competitors and also ahead of anyone else who threatens to come into their markets and compete with it. When you then put the strategy into execution..

  Economic consequences of implementation of official world

Although I'm specifically interested in the likely economic consequences of implementation of an official world auxiliary language, since this is only theoretical, I'd like to know what have been some economic consequences, whether positive or negati..

  Explain how might you make profits by purchases or sales

Explain  how might you make profits by purchases or sales of bonds now,with the intention to sell in a few months' time.

  Concepts of cross elasticity-income elasticity to product

Think of another good that you have purchased recently (or you could continue with the good you selected in TDA I). Be specific (e.g. is it breakfast cereal in general or Cheerios cereal specifically). If the price of this item increases, how would t..

  Preferences are represented by utility function

Ann’s preferences are represented by a utility function UA(x). Suppose one were to (colloquially) say that Carol has more “sensitive preferences” than Ann: her utility function UC (x) satisfies UC (x) = 2UA(x). Prove that for every choice set, Ann an..

  The elasticity of demand for low skilled labor

If the current minimum wage is $7.50 an hour, there are 10 million workers who earn the minimum wage, and the elasticity of demand for low skilled labor is -0.2.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd