1. Market demand for laptop computers is y = 500 - p. But the computers are developed by a hardware firm with a cost function c(y) = 100, & the operating system is developed by a software firm with a cost function of c(y) = 150. a. Calculate the optimal prices for the hardware & software firm to charge, & the total market quantity. (4 points) b. Calculate the optimal price & quantity if it were to behave like a merged firm

There are nine firms in industry X. The first firm’s sale is $300,000, the second firm’s sale is $250,000, the third firm’s sale is $200,000, the fourth firm’s sale is $150,000. There are 5 other firms, each generates sales of $80,000.

1. Calculate two measures of concentration.

2. If the second and third firms merged together, recalculate the two measures of concentration and determine whether the merger caused a higher concentration or not?

MergeSort has a rather high memory space requirement, because every recursive call maintains a copy of the sorted subarrays that will be merged in the merge step. What is the memory space requirement in terms of O(.)? Describe how you would implement MergeSort in such a way that merge is done in-place and less memory space is needed? In-place means MergeSort does not take extra memory for the merge operation as in the default implementation.

Use the given degree of confidence and sample data to construct a confidence interval for the population proportion p. Of 125 adults selected randomly from one town, 31 of them smoke. Construct a 99% confidence interval for the true percentage of all adults in the town that smoke.n

World Enterprises is determined to report earnings per share of $3.20. It therefore acquires the Wheelrim and Axle Company. There are no gains from merging. In exchange for Wheelrim and Axle shares, World Enterprises issues just enough of its own shares to ensure its $3.20 earnings per share objective.

a. Complete the table below for the merged firm. (Do not round intermediate calculations. Round "Price per share" and "Price-earnings ratio" to 2 decimal places and other answers to the nearest whole number.)

b. How many shares of World Enterprises are exchanged for each share of Wheelrim and Axle?

Shares exchanged?

c. What is the cost of the merger to World Enterprises?

Merger Cost?

d. What is the change in the total value of the World Enterprises shares that were outstanding before the merger?

Horizontal Mergers. Consider a market that initially has two firms selling differentiated products and competing in prices. The cost of production of each firm is C(q)=0. Demand for the two goods is given by the following system: q1=420-4p1+p2 q2=420-4p2+p1 The goal of this question is to find by how much the prices of the goods will increase if the firms horizontally merge. To do this, we first derive the equilibrium prices before the merger, and then compare with the optimal prices set by the merged firm.

a) Firm 1’s profit maximization problem is to choose p1 so as to solve: max [p1 (420-4p1+p2)] p1≥0 Derive firm 1’s first order condition (differentiating this profit function with respect to p1).

b) Assuming in equilibrium p1=p2, find the equilibrium prices before the merger.

c) If the firms merge, and continue to sell the same two products, the merged firm chooses both prices choosing p1 and p2 so as maximize problem. Write the profit maximization problem.

d) Find the profit maximizing prices. You may assume that these prices are equal p1=p2.

Suppose that a small town has seven burger shops whose respective shares of the local hamburger market are​ (as percentages of all hamburgers​ sold): 22 ​percent, 22 ​percent, 18 ​percent, 11 percent, 10 ​percent, 9 percent, and 8 percent.

The​ four-firm concentration ratio for the hamburger industry in this town is (?) percent. ​(Enter your response as a whole​ number.)

What is the Herfindahl index for the hamburger industry in this town?

If the top three sellers combined to form a single firm, what would happen to the four-firm concentration ratio and to the Herfindahl index?

One of the major problems in Latin America in the 1980s was according to some economists, the wager igidity. The wages were not falling down fast enough when economic conditions were demanding such a fall according to those economists. What could be a remedy those economists might have suggested to
decrease the wage rigidity?