Suppose the firm is a monopoly and its price schedule is:
How many brooms would the firm produce? Would the firm be making an economic profit?
Answer to relevant QuestionsThe following table shows cost data for three firms in perfect competition: Draw the supply curve for this perfectly competitive market. Why is game theory useful in describing the behavior of firms in oligopoly? According to game theorists, do oligopoly prices tend toward equilibrium? Why, or why not? Why do firms in oligopoly produce many brands of the same good? Let's play a two-firm theory of games, with high/ low price options and corresponding payoffs. Imagine the game played between Nike and Reebok. Construct your own profit options for Nike in the table provided and explain ...Why do some economists argue in favor of antitrust laws? What assumptions do they make concerning economies of scale?
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