Consider the market for nonalcoholic beers from the previous question. Cudweisers' price in a Nash equilibrium (assuming Bertrand competition in these differentiated beers) is about
a. 0.99
b. 1.09
c. 1.71
d. 2.55
b
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Goods, such as L.A. Lakers tickets and parking spaces around the stadium, are sometimes consumed together. Which of the following would decrease the demand for parking spaces around the stadium?
A) An increase in the price of Lakers tickets B) A higher parking fee C) A decrease in the price of Lakers tickets D) A substantial increase in the price of local cab services
In the Stackelberg model, suppose the first-mover has MR = 15 - Q1, the second firm has reaction function Q2 = 15 - Q1/2, and production occurs at zero marginal cost
Why doesn't the first-mover announce that its production is Q1 = 30 in order to exclude the second firm from the market (i.e., Q2 = 0 in this case)? A) In this case, MR is negative and is less than MC, so the first-mover would be producing less than the optimal quantity. B) In this case, MR is negative and is less than MC, so the first-mover would be producing too much output. C) This is a possible outcome from the Stackelberg duopoly under these conditions. D) We do not have enough information to determine if this is an optimal outcome for this case.
Speculators who are correct in their reading of the future pursue plans that unintentionally
What will be an ideal response?
Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4According to Figure 2.4, as the economy moves from Point E to Point A, the opportunity cost of hybrid cars, measured in terms of motorcycles
A. increases. B. initially increases, then decreases. C. decreases. D. remains constant.