{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

mid11w - Economics 302 Mid-Term Examination Instructor Greg...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Economics 302 Mid-Term Examination Instructor: Greg LeBlanc Date: February 9, 2011 PART A (Worth one third of the marks, budget one third of your time) Choose any TWO out of the following THREE. 1. All price—taking fi rms in a competitive industry have access to the technology C ( y i ) = 8+12 y i +2 y 2 i . Derive a typical fi rm’s short—run supply curve and show it on a graph. Derive the long—run supply curve for this industry based on free entry and price—taking behaviour, and show this curve on a graph. What would determine the number of fi rms in the industry? 2. In a Stackelberg industry with identical fi rms we know that fi rm 1, the leader, produces its monopoly quantity in equilibrium. Given this, does the Stackelberg leader necessarily earn a higher pro fi t than the Stackelberg follower? Explain. 3. Suppose that a monopolist has the ability to impose a two-part tari ff pricing policy. Would it necessarily set a positive fee as part of its pro fi t-maximizing policy? Explain.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}