Using the data provided, evaluate whether there is a positive or negative effect of a
Assume constant costs
Demand curve: P I 120 - 2Q
Marginal cost for the competitive rm (pre-merger): MCI = $20
Marginal cost for the merged company (mo
Review of Costs Chapter 2
1. Provide an example of an explicit and an implicit cost.
2. For the values of the hypothetical firm below, compute Economic Profit. Comment on
the difference between the accounting and economic profit.
3. Assume a firms weighte
IO EXAM I: REVIEW
Chapter 1: Introduction
SCP vs Chicago School
a. Two traditional approaches the study of industrial organization
b. SCP approach originally was primarily empirical in its orientation
c. Chicago school approach emphasize the use of price