skip to Main Content
The smarter way
to do assignments.

Please note that this is just a preview of a school assignment posted on our website by one of our clients. If you need assistance with this question too, please click on the Order button at the bottom of the page to get started.

If you have access to a computer with some software that will solve systems of linear equations (e.g., Mathematica, Maple, or Gauss), you should try this question.With the differentiated demand system given by equation (23.1), we can write down the system of equations that defines the equilibrium premerger (technically, the set of first-order conditions) as Ap = b where the matrix A is consists of the following coefficients:
A=

2b

d

e

d

2f

g

e

g

2h

p is the [3X1] vector of prices and the coefficient vector b consists of

b=

bc1

a1

f c2

a2

hc3

a3

The set of equations that defines the equilibrium after the merger (of products 1 and 2) is the same, but with the matrix A replaced by A_ where
A_

2b

2d

e

2d

2f

g

e

G

2h

Begin initially with the parameter values given in the text. Suppose now that products 1 and 2 are closer substitutes than either of them is to product 3. We can represent this by increasing the substitution parameter d between products 1 and 2 from a value of 2 to 3. Now recalculate the pre- and post merger equilibrium prices. What happens and why? Now suppose that the opposite is truethe merging products are not close substitutes. Set the parameter d equal to 2 again and the parameters e and g equal to 3. Recalculate the post merger equilibrium and once again explain the effects on prices.
The system of equations defining the equilibrium premerger is Ap = b. Begin initially with the parameter values given in the text. Products 1 and 2 are closer substitutes than either of them is to product 3. This can be represented by increasing the substitution parameter d between products 1 and 2 from a value of 2 to 3. Calculate again the pre-merger and…

ger equilibrium prices. Assuming that the Products 1 and 2 are not close substitutes. Set the parameter d equal to 2 again and the parameters e and g equal to 3. Calculate the post-merger equilibrium and once again explain the effects on prices.

## GET HELP WITH THIS ASSIGNMENT TODAY

Clicking on this button will take you to our custom assignment page. Here you can fill out all the additional details for this particular paper (grading rubric, academic style, number of sources etc), after which your paper will get assigned to a course-specific writer. If you have any issues/concerns, please don’t hesitate to contact our live support team or email us right away.

How It Works        |        About Us       |       Contact Us

© 2018 | Intelli Essays Homework Service®

Back To Top