Price Theory代写

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Price Theory代写
Price Theory

Assignment 2 { Market Power

Suppose that there are two rms competing in the market for taxi services. Big Ben

Taxis has the marginal cost MCB = $9 per trip, and the xed cost FCB = $3,000,000.

While Whitehall Taxis has the marginal cost MCW = $15 per trip, and the xed cost

FCW = $1,000,000.

Inverse demand for taxi trips in the market is given by the function,

P = 75