… Show more Two firms compete in quantities, selling identical goods, facing the demand function P(Q) = 130−q1− q2 where qi is the output level of firm i. Assume that firm 1 is more efficient than firm 2, MC1(q) = 10 and MC2(q) = 20. Find the NE quantities of this static game. Once you find equilibrium quantities, discuss how efficiency affects the location of a Best Response function, and in turn how efficiency affects equilibrium market shares • Show less
You bought a $100 used guitar and agreed to pay for it with a single $120 payment at the end of 6 mo… Show more You bought a $100 used guitar and agreed to pay for it with a single $120 payment at the end of 6 months. Assuming semiannual (every 6 months) compounding, A) Calculate the nominal interest rate B) Calculate the effective interest rate • Show less
What is a trading bloc and a trade concentration ratio, and does it make sense that trade concentrat… Show more What is a trading bloc and a trade concentration ratio, and does it make sense that trade concentration ratios should be greater than +1? • Show less
You will make 10 end-of-year deposits of $1000 to a savings account. Then for the next 5 years no mo… Show more You will make 10 end-of-year deposits of $1000 to a savings account. Then for the next 5 years no more deposits will be made. At the end of the next 15 years the savings account will have $20000. Calculate the rate of return for this savings account. You need to use a linear interpolation • Show less
Calculate the value of P in the cash flow diagram to make it equivalent. I=5%. You have to use at l… Show more Calculate the value of P in the cash flow diagram to make it equivalent. I=5%. You have to use at least one arithmetic gradient interest factor. • Show less
You deposit $1000 in a bank at the end of every year for 10 years and make no deposits the following… Show more You deposit $1000 in a bank at the end of every year for 10 years and make no deposits the following 5 years. If the bank pays 2% interest annually, how much would be in the account at the end of 15 years? • Show less
you are a manager for monopolistically competitive firm. From experience, the profits maximizing lev… Show more you are a manager for monopolistically competitive firm. From experience, the profits maximizing level of output of your firm is 100 units. However, it is expected that prices of other close substitutes will fall in the near future. how should you adjust your level of production in respons to this change? a. produce more than 100 units b. proces less than 100 units c. produce 100 units d. insufficient information to decide Please explain. • Show less
on the production fu… Show more The solution to principal-agent problem ensures that the firm is operating a. on the production function b. above the production function c. below the production function d. above the isoquant curve please provide an explanation. • Show less
a firm’ average cost is $20 and it charges a price of $20. The Lerner index for this firm is? a..20 … Show more a firm’ average cost is $20 and it charges a price of $20. The Lerner index for this firm is? a..20 b. .50 c. .33 d. insufficient information • Show less
the inverse demand in a Cournot dupoly is P=a-b(Q1+Q2) and costs are c1(Q1)=c1Q1,and C2(Q2)=c2Q2. Th… Show more the inverse demand in a Cournot dupoly is P=a-b(Q1+Q2) and costs are c1(Q1)=c1Q1,and C2(Q2)=c2Q2. The government has imposed a per unit tax of $t on each unit sold by each firm. The tax revue is ? a. t times the total output of the 2 firms should ther be no sale tax b. less than t times the total output of the 2 firms should there be no sale tax c. greater than t times the total output of the 2 firms should there be no sale tax d. none of the above. I initially answered (d). The problem does not tell how many unit sold. • Show less
