on a line from 0 to 1. Suppose that firm 1 is located at 0 and produces product 1, while firm 2 is located at 1 and produces product 2. Firms are competing by choosing prices. Assume that each firm?s marginal cost is zero.5.6.2A consumer pays pi + tx to buy product i (i = 1, 2), where pi is the price of product i, and x is the distance between the consumer and firm i, and t is the transportation cost to be paid for each distance traveled. Each consumer purchases only one product that minimizes her cost.(1) Find a critical consumer located at x who is indifferent between product 1 and product 2.(2) What is the demand for firm 1? Also, what is the demand for firm 2?(3) What is the profit function for firm 1? Find firm 1?s best response function for p1given p2.(4) What is the profit function for firm 2? Find firm 1?s best response function for p2given p1.(5) Find a Nash equilibrium (p?1,p?2). What is the equilibrium profit for each firm?
This question was answered on: Apr 19, 2020Buy this answer for only: $15
This attachment is locked
Pay using PayPal (No PayPal account Required) or your credit card . All your purchases are securely protected by .
About this QuestionSTATUS
Apr 19, 2020EXPERT
YES, THIS IS LEGAL
We have top-notch tutors who can do your essay/homework for you at a reasonable cost and then you can simply use that essay as a template to build your own arguments.
You can also use these solutions:
- As a reference for in-depth understanding of the subject.
- As a source of ideas / reasoning for your own research (if properly referenced)
- For editing and paraphrasing (check your institution's definition of plagiarism and recommended paraphrase).
NEW ASSIGNMENT HELP?
Order New Solution. Quick Turnaround
Click on the button below in order to Order for a New, Original and High-Quality Essay Solutions. New orders are original solutions and precise to your writing instruction requirements. Place a New Order using the button below.
WE GUARANTEE, THAT YOUR PAPER WILL BE WRITTEN FROM SCRATCH AND WITHIN A DEADLINE.