Recent content by samchan5167

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    Calculating the expected value for a probability

    part a: (100x8-150x3)(25%)+150(5)(50%)+150(5)(25%)=650 part b: (100x8-200x3)(25%)+(150x8-200x3)(50%)+200(5)(25%)=600
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    Calculating the expected value for a probability

    i get it now... so for part a: profit for demand 100 = 100(8-3)=500 for 150 = 150(8-3)=750 for 200 = 150(8-3)=750 so expected profit = 500(25%)+750(50%)+750(25%)=687.5 for part b: expected profit=500(25%)+750(50%)+1000(25%)=750 thanks for the thorough explanation
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    Cournot Model in a Duopoly Market

    Two firms producing the same kind of product in quantities of q1 and q2, respectively: Market clearing price p = a - b (q1 + q2) Profit for firm i: πi = (p – c) qi = [a - b (q1 + q2) – c] qi ,where c is the unit production cost. Define B = (a – c)/b, πi = b (B – q1 – q2) qi Objective: choose...
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    Calculating the expected value for a probability

    Thanks! If this is the case then, the two questions will have the same answer? This is my solution: profit=8-3=5 expected profit per day=5(100)(25%)+5(150)(50%)+200(5)(25%) Is this right?
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    Calculating the expected value for a probability

    Homework Statement An ice-cream store makes 150 ice-cream balls every day. The cost of making each ice-cream ball is $3. The price of an ice-cream ball is $8. The demand distribution is as follows: 100 ice-cream balls with probability 25%, 150 ice-cream balls with probability 50%, and 200...
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    Cournot Model in a Duopoly Market

    Homework Statement Two retailers compete on price in a market. Firm 1’s demand depends on both its own price and firm 2’s price as follows: q1 = b – p1 + ap2. Similarly, firm 2’s demand depends on its own price and firm 1’s price: q2 = b – p2 + ap1. Their marginal costs of producing one unit of...
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