{"id":106417,"date":"2022-01-26T09:48:45","date_gmt":"2022-01-26T09:48:45","guid":{"rendered":"https:\/\/essayparlour.com\/paperhelp\/?p=106417"},"modified":"2022-01-26T09:48:45","modified_gmt":"2022-01-26T09:48:45","slug":"because-cooking-souffles-is-incredibly-difficult-the-supply-of-souffles","status":"publish","type":"post","link":"https:\/\/essayparlour.com\/paperhelp\/business-economics-2\/because-cooking-souffles-is-incredibly-difficult-the-supply-of-souffles\/","title":{"rendered":"Because cooking souffl\u00e9s is incredibly difficult, the supply of souffl\u00e9s"},"content":{"rendered":"<table style = 'table-striped table-bordered table-hover' responsive='true'>\n<tr>\n<th>Question<\/th>\n<\/tr>\n<tr>\n<td>Because cooking souffl\u00e9s is incredibly difficult, the supply of souffl\u00e9s in a small French town is controlled by two bakers, Gaston and Pierre. The demand for souffl\u00e9s is given by P = 30 &#8211; 2Q, and the marginal and average total cost of producing souffl\u00e9s is $6. Because baking a souffl\u00e9 requires a great deal of work and preparation, each morning Gaston and Pierre make a binding decision about how many souffl\u00e9s to bake.<br \/>\n a. Suppose that Pierre and Gaston agree to collude, evenly splitting the output a monopolist would make and charging the monopoly price.<br \/>\n i. Derive the equation for the monopolist&#8217;s marginal revenue curve.<br \/>\n ii. Determine the profit-maximizing collective output for the cartel.<br \/>\n iii. Determine the price Pierre and Gaston will be able to charge.<br \/>\n iv. Determine profits for Pierre and Gaston individually, as well as for the cartel as a whole.<br \/>\n b. Suppose that Pierre cheats on the cartel agreement by baking one extra souffl\u00e9 each morning.<br \/>\n i. What does the extra production do to the price of souffl\u00e9s in the marketplace? ii. Calculate Pierre&#8217;s profit. How much did he gain by cheating? iii. Calculate Gaston&#8217;s profit. How much did Pierre&#8217;s cheating cost him? iv. How much potential profit does the group lose as a result of Pierre&#8217;s cheating?<br \/>\n c. Suppose that Gaston, fed up with Pierre&#8217;s behavior, also begins baking one extra souffl\u00e9 each morning.<br \/>\n i. How does the extra production affect the price of souffl\u00e9s in the marketplace? ii. Calculate Gaston&#8217;s profit. How much did he gain by cheating? iii. Calculate Pierre&#8217;s profit. How much did Gaston&#8217;s cheating cost him? iv. How much potential profit does the group lose as a result of Pierre&#8217;s and Gaston&#8217;s cheating?<br \/>\n v. Demonstrate that it is in neither Pierre&#8217;s nor Gaston&#8217;s best interest to cheat further on their agreement.<\/td>\n<\/tr>\n<\/table>\n","protected":false},"excerpt":{"rendered":"<p>Question<\/p>\n<p>\nBecause cooking souffl\u00e9s is incredibly difficult, the supply of souffl\u00e9s in a small French town is controlled by two bakers, Gaston and Pierre. The demand for souffl\u00e9s is given by P = 30 &#8211; 2Q, and the marginal and average <\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[42],"tags":[],"class_list":["post-106417","post","type-post","status-publish","format-standard","hentry","category-business-economics-2"],"_links":{"self":[{"href":"https:\/\/essayparlour.com\/paperhelp\/wp-json\/wp\/v2\/posts\/106417","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/essayparlour.com\/paperhelp\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/essayparlour.com\/paperhelp\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/essayparlour.com\/paperhelp\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/essayparlour.com\/paperhelp\/wp-json\/wp\/v2\/comments?post=106417"}],"version-history":[{"count":1,"href":"https:\/\/essayparlour.com\/paperhelp\/wp-json\/wp\/v2\/posts\/106417\/revisions"}],"predecessor-version":[{"id":106418,"href":"https:\/\/essayparlour.com\/paperhelp\/wp-json\/wp\/v2\/posts\/106417\/revisions\/106418"}],"wp:attachment":[{"href":"https:\/\/essayparlour.com\/paperhelp\/wp-json\/wp\/v2\/media?parent=106417"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/essayparlour.com\/paperhelp\/wp-json\/wp\/v2\/categories?post=106417"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/essayparlour.com\/paperhelp\/wp-json\/wp\/v2\/tags?post=106417"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}