What are the optimal renting rate and the renting quantity

Reference no: EM131914170

Problem

Suppose we are in an economy with two periods, a durable good last for two periods and a durable good monopolist. The demand for service from the durable good for each consumer is for t=1,2 marginal cost is 0, the discount factor isand consumers are perfectly rational.

Answers the following questions with the information above.

a) (If the monopolist rent out the product, what are the optimal renting rate and the renting quantity in each period?) b) First period price and quantity: First period price and quantity: c) If the monopolist sells out the product and the consumers become short-sighted, is the scheme provides part b implementable? Please explain

Reference no: EM131914170

Questions Cloud

List all possible outcomes for who : List all possible outcomes for who will get a part in the play in the following table. Two outcomes have been filled in for you (there are many more.)

Determine the correct probability of having 2 boys : Draw your friend a tree diagram of all possible outcomes, and use your tree diagram to determine the correct probability of having 2 boys and 2 girls.

What factors explain existence of monopoly power in markets : What factors explain the existence of monopoly power in markets? Do you believe any of these factors are more impactful than others? Explain your position.

Winning team in a sample of championship games : The following presents the number of goals scored by the winning team in a sample of championship games in thr World Cup soccer tournament.

What are the optimal renting rate and the renting quantity : What are the optimal renting rate and the renting quantity in each period?) First period price and quantity. First period price and quantity.

How the office of the president uses social media : Research and evaluate how the office of the President and Vice President uses social media as a platform for their agendas.

What is the appropriate analytic technique : A study has three treatment conditions for a single IV. What is the appropriate analytic technique?

Consider collection of people to be a population : Consider this collection of people to be a population. Let X be the number of days for a person sampled at random from this population.

Determine the probability that in a normal day : Determine the probability that in a normal day at least 5 premium clients go to the bank in one hour.

User Account

All Pages