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1. Sunrise Juice Company sells its output in a superbly aggressive
market. The agency’s whole price operate is given within the following
schedule:
Output
Complete Value
(Models)
($)
zero
50
10
120
20
170
30
210
40
260
50
330
60
430
Complete prices embrace a “regular” return on the time (labor
providers) and capital that the proprietor has invested within the agency. The prevailing
market worth is $7 per unit.
a. Put together marginal price schedule. (three Marks)
b. What’s the firmâs revenue maximizing output degree? (2 Marks)
Trace:Please consult with Questions 2 and four Tutorial 6 which is alsoP10.2 p.406 of your prescribed textbook.%20Check%202.%20Information%20Solutions.docx#_ftn1″ title=””>[1];
And Homework 1 also needs to allow you to.
2.
A agency producing hockey sticks has a
manufacturing operate given by:.png”>. In
the quick run, the firmâs quantity of capital gear is mounted at ok= 100. The
rental fee for Ok is v= $1, and the wage fee for L is w = $four.
a. Calculate the firmâs quick-run whole price curve. (1 Mark)
b. Calculate the quick-run common price curve. (1 Mark)
Trace:
This Question Assignment is precisely the identical Question Assignment together with your homework four, the one
distinction I gave you the particular worth of w=four which you didnât have for the
homework. One would have anticipated that software of the idea ought to be
straightforward and straight ahead. I posted the reply to this homework properly earlier than the
check; which ought to have made your research and revision a lot simpler.
three. In a relentless price business having zero marginal prices, the inverse
demand operate is given by P=12-Q. Estimate the equilibrium worth of the worth
and output for:
a. Monopoly. (1 Mark)
b. Cournot Duopoly. (2 Marks)
c. Excellent Competitors. (1 Mark)
Trace:
For Monopoly and Excellent Competitors, please
consult with Tutorial 7 Question Assignment 2 which can also be P12.5 p.495 of your
prescribed textbook; this Question Assignment compares monopoly versus aggressive market
equilibrium; additionally consult with questions three and four of the identical tutorial.
For Cournot Duopoly we did quite a lot of questions;
in Class we reworked instance on web page 513 of your textbook (and I requested you to
do the identical at your personal time); then throughout Tutorial eight we did questions 1
and a couple of which can also be P13.6 p.542 of your prescribed textbook
four. Acknowledge every of the next statements as being true or false
and clarify why.
a.
A set of methods
constitutes Nash equilibrium if no participant can enhance their place given the
methods chosen by different gamers.(1 Mark)
b.
A safe technique is
very conservative and will solely be thought-about if the rivalâs optimum technique
is similar.(1 Mark)
c.
A dominant technique
can also be a safe technique, however each safe technique isn’t essentially a
dominant technique.(1 Mark)
d.
In a one-shot sport,
the Nash equilibrium can also be one of the best end result that may be achieved underneath
collusion.(1 Mark)
Trace
These questions got here straight out of your textbook
and we outlined a few of these ideas if not all of them throughout tutorial 10; I
did emphasise the necessity to have a transparent understanding of all key ideas of
Recreation Concept. On the finish of Recreation Concept Matter, Chapter 14 of your prescribed
textbook there’s a one web page abstract which defines all these key ideas.
END OF TEST PAPER
[1]Mark Hirschey and
Bentzen M. (2014), Managerial
Economics, 13th version
