please solve all questions II. Monopoly Oligopoly On June 29.2007 Appl time Mark
ID: 3198684 • Letter: P
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please solve all questions
II. Monopoly Oligopoly On June 29.2007 Appl time Market Demand Function: Q 90- 3P Total Cost Function For All Firms: TC -60+60 a) Find the Quantity and Price that maximizes profit for Apple as a monopoly b) Find the Profit for Apple as a monopoly in Jane 2010, Samsung releasl the Galasy s o) Find the Quantity and Price produced by each firm under a duopoly (Stacketberg Modeb) a) Find the Profit for each firm under a duopoly (Stackelberg Model) e) Find the Quantity and Price produced by each firm under a duopoly (Coumot Model) ) Find the Profit for each firm under a duopoly (Cournot Model) 9 Explain the differences in Price between the Monopoly Model and Stackelberg Model What causes the differences? h) Explain the differences in Quantity between Stackelberg Model and Cournot Model. What causes the differences? e released the iPhone It was the only smartphone in the market at theExplanation / Answer
Q = 90-3P
Total cost = 60 + 6Q
Total Revenue = Price * Quanity = P ( 90-3P) = 90P - 3P2
Total Cost = 60 + 6Q = 60 + 6(90-3P) = 60 + 540 - 18P = 600-18P
Total Profit (TP) = Total revenue - total cost = 90P- 3P2 - (600-18P) = -3P2 + 72P - 600
To maximise profit, we differentaite it with respect to 'P' and equate to zero;
d TP/ dP = 0
-6P + 72=0
6P=72
P = 72/6 = 12;
If P=12 then Q= 90-3P = 90 - 3*12 = 90-36=54
a) Thus, the quantity and price that maximises profit for Apple is quantity = 54 and price = 12
b) Profit = TP = -3P2 + 72P - 600
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