Tutor week 15 October to 26 October.docx - ECONOMICS 2B 2018 TUTOR WEEKS 15 October to 26 October 2018 ACTIVITY 1 Assume the following figure and answer

Tutor week 15 October to 26 October.docx - ECONOMICS 2B...

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ECONOMICS 2B 2018 TUTOR WEEKS: 15 October to 26 October 2018 ACTIVITY 1 : Assume the following figure and answer the questions that follow. Task Answer Does iso-profit Π B1 indicate a higher or lower profit position for firm B when compared to iso-profit Π B2 ? Indicate the Cournot solution. Which firm is the sophisticated leader at point d ? Explain briefly the profit positions of the two firms when firm A is the sophisticated leader. 1
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Explain briefly how the contraction curve EE” is derived. Explain briefly why point c will result in greater industry profits and not point e . ACTIVITY 2 : Answer the following questions relating to the shareholder-management model Questions Answer 1. Changes in the financial security constraint (fsc) will affect [ growth in capital g C or growth in demand g d ] 2. The profit margin (pm) is used as a proxy for both ..................... and ...............................
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  • Summer '16
  • Joel
  • Economics, Economics of production

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