Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Suppose the ABC chemical company discovers a drug that cures the common cold. ABC has plants in Europe and in the United States and can produce the drug in either continent at a marginal cost of 10. There are no fixed costs. Where P = price, Q = quantity and subscripts E and U refer to Europe and the US respectively, the firm faces the following demand curves in the two continents: Europe: QE=70-PE US: QU=110-PU 1. Assuming that the firm is a profit maximiser and that it can engage in third degree price discrimination, what price will it charge in each continent? Explain the intuition of the result.
2. What profits does it earn?
3. Now assume that the governments of the two continents agree to forbid price discrimination on the basis that it harms consumers. ABC must now charge a single price, the same in Europe and the US. What price will it choose? What profits will it earn? (Hint: because there is a single price, you need to consider the demand curve for the total market, Europe plus the US).
4. Who gains and who loses when price discrimination is forbidden?
What is Money supply The monetary base is only a small part of the total money supply but, through the multiplier effect, the central bank's control over the money supply is ma
INDEX NUMBERS OF PRODUCTION Among the commonly used economic indicators to monitor current trends in the economy are indices of production. The main aggregative indices used t
How unemployement increases by firm relocating production If unemployment increases in a specific city because of a firm relocating production, it's structural unemployment tha
Who was the Labour Chancellor Gordon Brown In the period between 1997 and 2006 the Labour Chancellor Gordon Brown was committed to self-imposed Sustainable Investment Rule that
What is the present worth of a cash flow that gives you $6 in every time period from 1 to 20 when the interest rate is zero?
Explain the difference among saving and investment as explained by macroeconomists. Which of the following situations represent investment or saving? Explain: a) You u
In the long-run framework, budget surpluses: A. should be run on a permanent basis since they boost saving and investment and stimulate economic growth. B. should be run whenever o
A restaurant/bar is analyzing its pricing of beer. It has determined that the price elasticity of demand for beer is 0.8, the cross-price elasticity for wine with respect to the pr
Researchers have put forth various theories to explain the observed widening of the income distribution in the United States over the past four decades. First, there has been a sh
The questions posed are broad and open ended so be careful to allow yourself enough research and planning time. If you are completely on top of the material delivered in class, the
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!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd