Because its better, profit-wise, for a firm to be a monopoly and be regulated than to openly compete in an unregulated market. The firm is able to maintain it's monopoly because the regulators keep outside competition from entering by not allowing new cable lines.
Do a little research, and then take a shot. what do you think? Hint. GNP is an economic aggregate.
MICROECON - Perfect Competition
Because all the firms have identical cost structures, all firms would be operating at the minimum of their average cost curve. Further, in long-run equilibrium, Price=MC=ATC. So firms are not making economic profits. Now then, impose the $5 per unit tax. 1) Market price INCREA...
Take a shot, what do you think? Hint A: What is an insurance policy a common way people avoid financial risks? Hint B: What would the elasticity of coffee need to be in order for speculators to come in and buy coffee futures.
This is a rather open-ended question. Repost with your thinking. I or others will be glad to critique your thinking.
For a) you could calculate directly, or you could use a poisson distribution function. Let me calculate directly. The probability that exactly n return is 6-choose-n * .75^n * .25^(6-n) P(all) = .75^6 = .1720 P(5) = 6*(.75^5)*.25 = .3540 P(4) = ((6*5)/2)*(.75^4)*(.25^2) = .296...
I tells me that b is garbage, of which a person with such a utility function would want as little as possible -- zero would be ideal.
Well yes, there would be some saps who pay full price fot the 16gb. However, I believe most consumers are savy enough to recognize the difference. So, the quantity of 16gb models sold would certainly drop by a bunch.
With the quota, do you mean "NO more than 50"? Without the quota, the equilibrium price and quantity would be where supply=demand or (500-p)=(300+p) -- solve or p. I get p=100, ergo Qd=Qs=400. If more than 50 must be sold, no problemo. If no more than 50, and the quo...
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