This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: In the Bertrand model with homogeneous products, A) the firm that sets the lower price will ... (Read 16 times)

amal

  • Hero Member
  • *****
  • Posts: 572
on: Jul 1, 2018
In the Bertrand model with homogeneous products,
 
  A) the firm that sets the lower price will capture all of the market.
  B) the Nash equilibrium is the competitive outcome.
  C) both firms set price equal to marginal cost.
  D) all of the above
  E) the outcome is inconclusive.

Question 2

Marge's Beauty Salon sells shampoo and conditioner. Marge has two types of customers. Their willingness-to-pay for shampoo and conditioner are given in the table below.
 
  If Marge bundles the shampoo and conditioner, could she increase revenue? Shampoo Conditioner Type I 8 5 Type II 6 8


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

Loise Hard

  • Sr. Member
  • ****
  • Posts: 340
Reply #1 on: Jul 1, 2018
Answer to Question 1

D

Answer to Question 2

If Marge bundles the products together and sells the bundle for 13, each of her customers will be willing to buy the bundle. Without bundling, Marge would need to sell the shampoo for 6 and the conditioner for 5 in order to sell each customer both items. Thus, revenue from both items is 11 for each customer. Bundling increases Marge's revenues by 2 per customer.


amal

  • Member
  • Posts: 572
Reply 2 on: Jul 1, 2018
Gracias!

ghepp

  • Member
  • Posts: 361
Reply 3 on: Yesterday
Great answer, keep it coming :)

« previous next »
 

Did you know?

Malaria mortality rates are falling. Increased malaria prevention and control measures have greatly improved these rates. Since 2000, malaria mortality rates have fallen globally by 60% among all age groups, and by 65% among children under age 5.

Did you know?

According to the American College of Allergy, Asthma & Immunology, more than 50 million Americans have some kind of food allergy. Food allergies affect between 4 and 6% of children, and 4% of adults, according to the CDC. The most common food allergies include shellfish, peanuts, walnuts, fish, eggs, milk, and soy.

Did you know?

The newest statin drug, rosuvastatin, has been called a superstatin because it appears to reduce LDL cholesterol to a greater degree than the other approved statin drugs.

Did you know?

A good example of polar molecules can be understood when trying to make a cake. If water and oil are required, they will not mix together. If you put them into a measuring cup, the oil will rise to the top while the water remains on the bottom.

Did you know?

When blood is deoxygenated and flowing back to the heart through the veins, it is dark reddish-blue in color. Blood in the arteries that is oxygenated and flowing out to the body is bright red. Whereas arterial blood comes out in spurts, venous blood flows.

Critical Thinking Model Critical Thinking Model
The risk of dying before the age of 65 gets lower as family income gets higher. The risk of dying before the age of 65 gets lower as family income gets higher.
The lower intake manifold attaches to the cylinder heads. The lower intake manifold attaches to the cylinder heads.
A model for the action of RecBCD, (c) sites, and RecA in initiating homologous recombination A model for the action of RecBCD, (c) sites, and RecA in initiating homologous recombination
Firm handshake Firm handshake
The epigenetic stem cell model proposes that both epigenetic changes The epigenetic stem cell model proposes that both epigenetic changes
Video: Component of feedback systems & Communication and regulation of body systems

For a complete list of videos, visit our video library