« previous next »

Author Question: In year 2008, 1334 million lbs of milk was produced and sold in U.S. This is A) the decision of ... (Read 57 times)

newbem

  • Hero Member
  • *****
  • Posts: 579
on: Jul 1, 2018
In year 2008, 1334 million lbs of milk was produced and sold in U.S. This is
 
  A) the decision of the U.S. department of agriculture.
  B) quantity determined by the interactions in the market.
  C) the maximum amount the producers could produce.
  D) what consumers needed.

Question 2

Suppose market demand is p = 10 - Q. Firms have a fixed entry cost of 5 and no marginal cost. If firm A is the incumbent, can it deter the entry of its rival, firm B?
 
  What will be an ideal response?


randomguy133

  • Sr. Member
  • ****
  • Posts: 310
Reply #1 on: Jul 1, 2018
Answer to Question 1

B

Answer to Question 2

Firm B's reaction function is qB = 5 - (1/2)qA. The Stackelberg leader quantity is 5 and firm B will produce 2.5. Firm A's profit is 12.5. If firm A produces 6 units for example, firm B's best response is
2 units; however, it would incur a loss and not enter. Firm A's profits by preventing entry would be 24. Thus, firm A can deter entry by overproducing.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

Amphetamine poisoning can cause intravascular coagulation, circulatory collapse, rhabdomyolysis, ischemic colitis, acute psychosis, hyperthermia, respiratory distress syndrome, and pericarditis.

Did you know?

There are over 65,000 known species of protozoa. About 10,000 species are parasitic.

Did you know?

Hyperthyroidism leads to an increased rate of metabolism and affects about 1% of women but only 0.1% of men. For most people, this increased metabolic rate causes the thyroid gland to become enlarged (known as a goiter).

Did you know?

Of the estimated 2 million heroin users in the United States, 600,000–800,000 are considered hardcore addicts. Heroin addiction is considered to be one of the hardest addictions to recover from.

Did you know?

In 2010, opiate painkllers, such as morphine, OxyContin®, and Vicodin®, were tied to almost 60% of drug overdose deaths.

The proportion of obese and extremely obese adults in the United States has increased over the past The proportion of obese and extremely obese adults in the United States has increased over the past
A Lexical Decision Task A Lexical Decision Task
Overfished per year Overfished per year
Top Eleven Countries in Year 2009 According to Three Different Measures Top Eleven Countries in Year 2009 According to Three Different Measures
Disitive Time For Milk Products Disitive Time For Milk Products
The Serial Numbers for Each Day of the Year The Serial Numbers for Each Day of the Year
Video: Medullary osmotic gradient: countercurrent multiplier, urea recycling & vasa recta countercurrent exchange

For a complete list of videos, visit our video library