q 2
... • Sharp and Xerox compete in copiers. Payoffs for Xerox are in the lower triangle • The payoffs depend on the number of territories in which they compete • Sharp has a dominant strategy of 6 territories. • What should Xerox do? • We see we get to {6, 6} as the iterated dominate strategy. Slide 31 ...
... • Sharp and Xerox compete in copiers. Payoffs for Xerox are in the lower triangle • The payoffs depend on the number of territories in which they compete • Sharp has a dominant strategy of 6 territories. • What should Xerox do? • We see we get to {6, 6} as the iterated dominate strategy. Slide 31 ...
Unit8Micro - Inflate Your Mind
... Oligopoly (Several Sellers) Characteristics of an oligopoly industry include: 1. A Few firms (2, 3, 4, ...) control the majority of the sales 2. More difficult to start up (barriers to enter) 3. Firms are interdependent 4. Firms mostly advertise on a national scale ...
... Oligopoly (Several Sellers) Characteristics of an oligopoly industry include: 1. A Few firms (2, 3, 4, ...) control the majority of the sales 2. More difficult to start up (barriers to enter) 3. Firms are interdependent 4. Firms mostly advertise on a national scale ...
Mergers
... maximise its own profits in a one-shot game. This yields a price-setting Nash equilibrium with the following outcomes1. Price of all three brands = 1 The market is shared equally between the three brands At this price, each brand has an own price elasticity of –3, and all cross-price elasticit ...
... maximise its own profits in a one-shot game. This yields a price-setting Nash equilibrium with the following outcomes1. Price of all three brands = 1 The market is shared equally between the three brands At this price, each brand has an own price elasticity of –3, and all cross-price elasticit ...
Exam 3 test and key
... 19. (Repeat your answer on Scantron line 42.) The numbers in the table represent current prices of four goods in two different nations, Rahrah and Goofonia. Each price is expressed in the local currency of that country, which is the "rah" in Rahrah and the "goofus" in Goofonia. These two countries ...
... 19. (Repeat your answer on Scantron line 42.) The numbers in the table represent current prices of four goods in two different nations, Rahrah and Goofonia. Each price is expressed in the local currency of that country, which is the "rah" in Rahrah and the "goofus" in Goofonia. These two countries ...
Lec 21
... – If a firm gets too big or too bad, or both, the government may decide to step in using antitrust laws – The market limits monopoly power basically through the development of substitutes ...
... – If a firm gets too big or too bad, or both, the government may decide to step in using antitrust laws – The market limits monopoly power basically through the development of substitutes ...
Product differentiation, kinked demand and collusion
... scenario defines an equilibrium in quantities. Therefore, the former collusive scenario is a symmetric equilibrium in both quantities and locations. ...
... scenario defines an equilibrium in quantities. Therefore, the former collusive scenario is a symmetric equilibrium in both quantities and locations. ...
ECN 104 Notes: Week of March 24 Chapter 9: Pure Competition
... as best for society. Hence, perfect competition is allocatively efficient. If we were to reallocate resources and produce less of this good and more of another, then P>MC and we would be under allocating resources to this good. The desire for the good is greater than the cost of the resources which ...
... as best for society. Hence, perfect competition is allocatively efficient. If we were to reallocate resources and produce less of this good and more of another, then P>MC and we would be under allocating resources to this good. The desire for the good is greater than the cost of the resources which ...
5. THEORY OF COMPETITION Three features of MR=MC rule: 1
... similar commodities because of differences in buyers’ willingness to pay (not because of costs of production) . The key idea is to convert consumer surplus into economic profit. Monopoly is able to discriminate the prices when the firm: 1. has got a market power (a diminishing demand function) 2. ha ...
... similar commodities because of differences in buyers’ willingness to pay (not because of costs of production) . The key idea is to convert consumer surplus into economic profit. Monopoly is able to discriminate the prices when the firm: 1. has got a market power (a diminishing demand function) 2. ha ...
lecture 2 – natural monopoly regulation
... But when consumers are heterogeneous, consumers with low willingness to pay drop out of the market if K/N>CS(c) When consumers are hetereogeneous, welfare maximizing nonlinear tariffs will most likely involve the firm offering consumers discriminatory two-part tariffs: ...
... But when consumers are heterogeneous, consumers with low willingness to pay drop out of the market if K/N>CS(c) When consumers are hetereogeneous, welfare maximizing nonlinear tariffs will most likely involve the firm offering consumers discriminatory two-part tariffs: ...
NSS Understanding and Interpreting the Economics Curriculum
... • Value Positive analysis normative policy suggestion • From the standpoint of maximising social gains, should the illegal practice of reproducing discs be firmly suppressed so that only the higher-priced original discs can be found on the market? Explain. (HKALE 1994 Q8) ...
... • Value Positive analysis normative policy suggestion • From the standpoint of maximising social gains, should the illegal practice of reproducing discs be firmly suppressed so that only the higher-priced original discs can be found on the market? Explain. (HKALE 1994 Q8) ...
Wk7
... large share of total sales in the market. To determine if a market is concentrated, the government uses the Herfindahl-Hirschman Index (HHI), created by squaring the percentage market shares of each firm, and adding up the results. Some examples are given below: Firm market shares ...
... large share of total sales in the market. To determine if a market is concentrated, the government uses the Herfindahl-Hirschman Index (HHI), created by squaring the percentage market shares of each firm, and adding up the results. Some examples are given below: Firm market shares ...
COMPETITION, CONSUMER WELFARE, AND THE SOCIAL COST
... We take as benchmark a Pareto optimal state of economy that provides the same level of consumer satisfaction as achieved in the monopolized state.9 The primary objective of antitrust policy is to promote consumer welfare and efficiency, and Pareto optimality embodies both of these objectives. To thi ...
... We take as benchmark a Pareto optimal state of economy that provides the same level of consumer satisfaction as achieved in the monopolized state.9 The primary objective of antitrust policy is to promote consumer welfare and efficiency, and Pareto optimality embodies both of these objectives. To thi ...
The Economic Way of Thinking 10e ©Prentice Hall 2003
... The movement towards deregulation of the past two decades has not settled all the issues. History There are more margins on which competition can occur Competition has some advantages over commissions ...
... The movement towards deregulation of the past two decades has not settled all the issues. History There are more margins on which competition can occur Competition has some advantages over commissions ...
Understanding Demand - White Plains Public Schools
... • One reason that the law of demand exists is the substitution effect. • The substitution effect occurs when a consumer reacts to an increase in a good’s price by buying less of that good and more of a similar yet cheaper good. ...
... • One reason that the law of demand exists is the substitution effect. • The substitution effect occurs when a consumer reacts to an increase in a good’s price by buying less of that good and more of a similar yet cheaper good. ...
lecture 5 - WordPress @ VIU Sites
... • Market structure “causes” firms to behave in a certain way. • … this behavior, or conduct, “causes” resources to be allocated in certain ways. • … this resource allocation leads to “good” or “bad” performance. ...
... • Market structure “causes” firms to behave in a certain way. • … this behavior, or conduct, “causes” resources to be allocated in certain ways. • … this resource allocation leads to “good” or “bad” performance. ...
ch14
... and arose from three main influences: 1. Economists have become more confident and vocal in predicting the gains from deregulation. 2. The significant hike in energy prices of the 1970s increased the cost of regulation borne by consumers. ...
... and arose from three main influences: 1. Economists have become more confident and vocal in predicting the gains from deregulation. 2. The significant hike in energy prices of the 1970s increased the cost of regulation borne by consumers. ...
Slide 1
... • Market structure “causes” firms to behave in a certain way. • … this behavior, or conduct, “causes” resources to be allocated in certain ways. • … this resource allocation leads to “good” or “bad” performance. ...
... • Market structure “causes” firms to behave in a certain way. • … this behavior, or conduct, “causes” resources to be allocated in certain ways. • … this resource allocation leads to “good” or “bad” performance. ...
CHAPTER 11
... this condition is to economics what understanding gravity is to physics. It gives one a sense of if, how, and why prices and quantities move. Applying the Tools: Profit Maximization and Real World Firms Real-world firms are happy to hold down the factors of production, except for the cost of the dec ...
... this condition is to economics what understanding gravity is to physics. It gives one a sense of if, how, and why prices and quantities move. Applying the Tools: Profit Maximization and Real World Firms Real-world firms are happy to hold down the factors of production, except for the cost of the dec ...
Perfect Competition Chapter 11
... prices and higher profits. • Existing firms increase output and new firms will enter the market, increasing output still more, price will fall until all profit is competed away. ...
... prices and higher profits. • Existing firms increase output and new firms will enter the market, increasing output still more, price will fall until all profit is competed away. ...
Chapter 10: Monopolistic Competition and Oligopoly
... costs across firms, the greater will be the differences in economic profits among firms If cartel members try to equalize each firm’s total profit, a high-cost firm would need to sell more than a low-cost firm This allocation scheme violates the cartel’s profit-maximizing condition of finding the ...
... costs across firms, the greater will be the differences in economic profits among firms If cartel members try to equalize each firm’s total profit, a high-cost firm would need to sell more than a low-cost firm This allocation scheme violates the cartel’s profit-maximizing condition of finding the ...
Handout - Web.UVic.ca
... monopoly This is usually done by creating laws that attempt to ensure a degree of competition ...
... monopoly This is usually done by creating laws that attempt to ensure a degree of competition ...
Industry analysis
... Concentration increases specialization In sum, increases in industry concentration often are accompanied by increases in the numbers and variety of specialists. Far from being hostile to niche strategists, concentrated industries are an ideal breeding ground for these specialists. ...
... Concentration increases specialization In sum, increases in industry concentration often are accompanied by increases in the numbers and variety of specialists. Far from being hostile to niche strategists, concentrated industries are an ideal breeding ground for these specialists. ...
Tcheque
... there instances where an above costs abuse was identified in your jurisdiction? Please describe In the Czech Republic, I have not identified any case dealing with this issue. There is no praxis, yet. The outcome of the replicability assessment depends also on the definition of the sales of the domin ...
... there instances where an above costs abuse was identified in your jurisdiction? Please describe In the Czech Republic, I have not identified any case dealing with this issue. There is no praxis, yet. The outcome of the replicability assessment depends also on the definition of the sales of the domin ...