(1204-12/1o, an increase in profit of $400 an increase in profit of $250 O a dec
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(1204-12/1o, an increase in profit of $400 an increase in profit of $250 O a decrease in proft of $250 QUESTION9 1 peints Save Arewer Table: Drmand Se Quaatity of GadgstGadgets Demanded Gadgets. The maket for gadgets is dominahed by two producers, Margaret and Ray Exch tom can produce Table: Demand Schedule for Gadgerts) Look at the table Demand Schedule for nat a Ngnal oost of $0. The table L shows the market demand schedule for gedgets Suppose hat these two producers have formed a cartel and are maximiring total induaitry prots if angeret decicses to cheat on the agreement and sel 100 more gadgets bue Ray continues to sell 250 gadgets, Ray's pretts will be $1,400 $1.250 $1,000. $400 QUESTION 1 Demnd Schedul' of Gadprts Price of Quaatily ef Gadgst Cadpts Demanded 4Explanation / Answer
Option b -1250
Profit = TR - TC, since MC = 0, TC = 0.
Thus, profit = TR
When they form a cartel, they will charge a price of $5 per unit and each firm supplies 250 units each. But, margaret decides to sell 100 more gadgets. To sell 100 more, she must reduce her price to $4 per unit.
However, Ray will continue to sell 250 units at $5, for which he will earn a profit of $1250
P Qd TR= Profit 10 0 0 9 100 900 8 200 1600 7 300 2100 6 400 2400 5 500 2500 4 600 2400 3 700 2100 2 800 1600 1 900 900 0 1000 0Related Questions
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