05.Handout for Price Cap Debate (092310)

05.Handout for Price Cap Debate (092310) - Is there any...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
P* Q 5 Q fringe MR 5 RD 5= D Tot -MC fringe D Tot MC 5 MC fringe = MC of next plant that Big 5 can use = MC of last plant that fringe is using Quantity Price Questions: What price does the “Big 5” choose if they act like a joint monopolist on residual demand?
Background image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Is there any allocative inefficiency? Is there any productive inefficiency? P cap...
View Full Document

{[ snackBarMessage ]}

Ask a homework question - tutors are online