Still can't believe I paid thousands of dollar to sit through hours of lecture that is better summarized by a free 7-min TH-cam video. Thank you so much, you are my savior!
Thanks for this video. I'm taking this class over the summer and my professor has zero contact with students. We just have an outline that tells us what to read and connect grades all our work. I had to watch your video to really get the materia.
Could you slove it? Consider a homogeneous good duopoly with linear demand , where is the total industry output. Marginal cost is symmetric for two firms and equals . a) Suppose that firms simultaneously set quantities. Determine the equilibrium (price, quantities, profit). b) Suppose the two firms merges to a single firm. So the market becomes monopolistic. Determine the optimal (price, quantity, profit) after the change. c) Suppose there is diseconomy of scale after merger, so that marginal cost raises to . Is it possible for merger to happen voluntarily? Why?
(Cost Inefficiency in Cournot) Consider a Cournot competition model with market demand P(Q) = 1 − Q. Two firms have different cost functions: TC1(q1) = c1q1 and TC2(q2) = c2q2, where c1 < c2. (a) Explain why total welfare in Cournot equilibrium is W C = 1 2Q2+q1 2+q2 2, where qi is equilibrium output of firm i and Q = q1 + q2. (b) Imagine that the total output produced in the Cournot equilibrium could be allocated across firms in a different way. Which allocation would be socially optimal? (c) Suppose that the firms form a cartel. What would the ideal output of that cartel be? How is production allocated across firms? (d) Explain why the ideal cartel allocation would be hard to implement in the presence of antitrust scrutiny. (e) Explain why total welfare under cartel is W M = 3 2(Qm)2, where Qm is the cartel output. (f) Are there values of c1 and c2 such that consumer welfare goes up as a result of cartelisation? Interpret. (g) Suppose that c1 = 0. Are there values of c2 such that social welfare goes up as a result of cartelisation? Interpret help me solving this
Still can't believe I paid thousands of dollar to sit through hours of lecture that is better summarized by a free 7-min TH-cam video. Thank you so much, you are my savior!
Welcome.
u pay for uni ??
Thanks for this video. I'm taking this class over the summer and my professor has zero contact with students. We just have an outline that tells us what to read and connect grades all our work. I had to watch your video to really get the materia.
This is so good explanation. Simple so brief. Thank you very much!
You are welcome.
you're so helpful thankyou! been pulling my hair out about this for days now, so well explained
Glad it helped.
super helpful thank you so much!
When your professor never even mentions the word "derivative"...well ghee that would've helped some
this video saved my life - thank you!!! the confusing equations for reaction functions they give you in lecture SUCK
You are welcome.
This was great kinda sorta understood this done this way now to find one for Stackelberg!
Thank you so much for this! Your explanation was simple and easy to understand, appreciate it very much
You are welcome.
many thanks! It's so clear to understand!
This is such a better example then the book provided. Thank you so much
You are welcome,
God bless you so much for thus
you SAVED me!!! i have a quiz in ten minutes and had no idea what i was doing twenty minutes ago. god bless you.
Good to hear.
Helpful! Do you tutor by any chance?
Could you slove it? Consider a homogeneous good duopoly with linear demand , where is the total industry output. Marginal cost is symmetric for two firms and equals .
a) Suppose that firms simultaneously set quantities. Determine the equilibrium (price, quantities, profit).
b) Suppose the two firms merges to a single firm. So the market becomes monopolistic. Determine the optimal (price, quantity, profit) after the change.
c) Suppose there is diseconomy of scale after merger, so that marginal cost raises to . Is it possible for merger to happen voluntarily? Why?
Will firms stay in collusion in this situation? Because their profit for collusion is greater than when they were in cournot equilibrium
Simple, short, gets to the point. Love it.
Thanks.
Thank you so much. Simple and better presentation. Thank you so much.
You are welcome.
(Cost Inefficiency in Cournot) Consider a Cournot competition model with
market demand P(Q) = 1 − Q. Two firms have different cost functions: TC1(q1) = c1q1 and
TC2(q2) = c2q2, where c1 < c2.
(a) Explain why total welfare in Cournot equilibrium is W C = 1 2Q2+q1 2+q2 2, where qi is equilibrium
output of firm i and Q = q1 + q2.
(b) Imagine that the total output produced in the Cournot equilibrium could be allocated across
firms in a different way. Which allocation would be socially optimal?
(c) Suppose that the firms form a cartel. What would the ideal output of that cartel be? How is
production allocated across firms?
(d) Explain why the ideal cartel allocation would be hard to implement in the presence of antitrust
scrutiny.
(e) Explain why total welfare under cartel is W M = 3 2(Qm)2, where Qm is the cartel output.
(f) Are there values of c1 and c2 such that consumer welfare goes up as a result of cartelisation?
Interpret.
(g) Suppose that c1 = 0. Are there values of c2 such that social welfare goes up as a result of
cartelisation? Interpret
help me solving this
Still need help
nicely explained
This was just perfect, thanks
You are welcome.
Perfection. non complex and to the point!
You are welcome.
6 years later he saves my ass one day before the exam xD
thank you for this explanation!!!
You are welcome.
Thank you.
You are welcome.
I am a indian and thanku its nice
In my case there is no MR given just the function and i have to calculate the costs for the two firms. How can i do that ?
MR is the derivative of TR, you might be able to find that
dude thank you very much you saved me !
he saved us both
is the total cost MC x q or AC x q?
Since fixed cost is 0, MC=AC.
@@guypascale2300 I still think this is incorrect. MC is always dependent on TVC even if TFC = 0. Please revisit I might be missing something.
SO MUCH HELP, THANK YOU!
You are welcome.
Is q1 always equal to q2?
So does that mean the equilibrium quantity is 160? i mean 80 + 80?
Correct. q1 + q2 is the equilibrium quantity as there are only two sellers.
thank you!!
You're welcome.
Very very thank you
then again q2=0 (Firm 2) ,finding the TR and TR` AND find P , then compare the first P
thanks
💪😎
how do you get 0.75..can somebody explain to me. thnk you .
1- 0.25 that is q1 - 0.25q1 after collecting like terms