ECONOMICS 4139
California University Of Pennsylvania
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Exercises and solutions - Part II|Industrial Organization: Markets and Strategies
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Industrial Organization: Markets and Strategies Exercises & Solutions
Exercise 1 Monopoly with quality choice
Consider a monopolist who sells batteries. Each battery works for h hours
and then needs to be replaced. Therefore, if a consumer buys q batteries, he
gets H = qh hours of operation. Assume that the demand for batteries can be
derived from the preferences of a representative consumer whose indirect utility
function is v = u(H) pq, where p is the price of a battery. Suppose that u
...
Exam (elaborations)
Exercises and solutions - Part II|Industrial Organization: Markets and Strategies
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Industrial Organization: Markets and Strategies Exercises & Solutions Exercise 1 Monopoly with quality choice Consider a monopolist who sells batteries. Each battery works for h hours and then needs to be replaced. Therefore, if a consumer buys q batteries, he gets H = qh hours of operation. Assume that the demand for batteries can be derived from the preferences of a representative consumer whose indirect utility function is v = u(H) pq, where p is the price of a battery. Suppose that u ...
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