An intermediary offers clients a financial service, and the intermediary faces a fixed cost of $24,000. The
Question:
An intermediary offers clients a financial service, and the intermediary faces a fixed cost of $24,000. The intermediary currently has 82,000 clients and faces a variable cost of $5.50 per client. In this case, what is the most competitive price offer the intermediary can charge each client?
Group of answer choices
$5.8
$6.4
$11.5
$33.5
Firm A & B compete for market share, where xi is firm i's client base, for i = A & B. Firm A has a cost of $2.5 per client and a fixed cost of $750, while B has a cost of $4.5 per client and a fixed cost of $450. If firm A can offer a competitive price of $6.00 and B can offer $7.40, then it must be that A has _____ clients and B has ______ clients.
Group of answer choices
234; 155
234; 163
214; 155
214; 163
Managerial Economics
ISBN: 978-0133020267
7th edition
Authors: Paul Keat, Philip K Young, Steve Erfle