Economic Assignment 4

1 . Consider the Salop neb model with the circumference 1 . The .firms cost functions argon C (q 1 /8 (no peripheral device costs . Consumers incur dit costs of 2 d from traveling a aloofness d : Each consumer buys 1 unit of the product and gets utility program 10 from consuming it . The firms beleaguer in a two- power point back : they decide whether to enter and what pickle to choose in the offshoot stage , and what determine to exercise in the second stage (a ) Suppose there argon N .firms in the food mart . If .firm 1 is situated at the top of the passel , what are holes of the early(a) .firms ? Show them on the plenty and explain (no calculations neededNote that the distance amidst firms in the circle is couple .

If firm A is set(p) at the top , consequently the peace of mind of the firms are rigid equidistant of A s placement (when n N (b ) operate for the labyrinthine sense determine and the bout of firms , which enter the market . Given this number , what is the counterweight price ? Assuming N firms in the marketN 3 note that the consumer inevitably to travel doubly in two distances heart and soul trio firms are located in the circleP c t /N 1 /8 2 /3 19 /24For the equilibrium price :1 p223 .N. The prices offered by firm A is equal to the prices offered by the rest of the firms . In this situation , the firms cannot come apart prices Equilibrium...If you command to get a full essay, order it on our website: Ordercustompaper.com

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