Business
Business, 16.04.2020 04:36, AdiGirlBrainly

Barnacle Industries was awarded a patent over 15 years ago for a unique industrial strength cleaner that removes barnacles and other particles from the hulls of ships. Thanks to its monopoly position, Barnacle has earned more than $160 million over the past decade. Its customers—spanning the gamut from cruise lines to freighters—use the product because it reduces their fuel bills. The annual (inverse) demand function for Barnacle’s product is given by P = 400 – .0005Q, and Barnacle’s cost function is given by C(Q) = 250Q. Thanks to subsidies stemming from an energy bill passed by Congress nearly two decades ago, Barnacle does not have any fixed costs: The federal government essentially pays for the plant and capital equipment required to make this energy-saving product. Absent this subsidy, Barnacle’s fixed costs would be about $4 million annually. Knowing that the company’s patent will soon expire, Marge, Barnacle’s manager, is concerned that entrants will qualify for the subsidy, enter the market, and produce a perfect substitute at an identical cost. With interest rates at 7 percent, Marge is considering a limit-pricing strategy. a.What would Barnacle's profits be if Marge pursues a limit-pricing strategy if the subsidy is in place? $ Instruction: Round all answers to the nearest penny (two decimal places).b. What would Barnacle's profits be if Marge convinces the government to eliminate the subsidy? $ c. What would be the profit of a new entrant if the subsidy is eliminated and Barnacle continues to produce the monopoly level of output? $ d. Which strategy is more beneficial to Barnacle? Limit pricing Eliminating the subsidy and continuing to produce the monopoly output Comment

answer
Answers: 3

Other questions on the subject: Business

image
Business, 21.06.2019 19:00, nicoleskertich
What is credit and debit in accounting
Answers: 2
image
Business, 21.06.2019 21:00, yasarhan2
Suppose an economist believes that the price level in the economy is directly related to the money supply, or the amount of money circulating in the economy. the economist proposes the following relationship: p=a x m - p=price level - m=money supply - a=a composite of other factors, including real gdp, that change very slowly over time. how might an economist gather empirical data to test the proposed relationship between money and the price level? an economist would persuade the federal reserve to change the money supply to various levels, and observe the resulting changes in the price level. unlike researchers in the hard sciences, economists cannot study complex relationships using data. economists do not usually develop theoretical models of the economy but only analyze summary statistics about the current state of the economy. an economist would look for data on past changes in the money supply, and note the resulting changes in the price level
Answers: 1
image
Business, 21.06.2019 22:50, jonlandis6
Synovec co. is growing quickly. dividends are expected to grow at a rate of 24 percent for the next three years, with the growth rate falling off to a constant 7 percent thereafter. if the required return is 11 percent, and the company just paid a dividend of $2.05, what is the current share price? (do not round intermediate calculations and round your answer to 2 decimal places, e. g., 32.16.)
Answers: 2
image
Business, 22.06.2019 14:20, dieguezisabel
In canada, the reference base period for the cpi is 2002. by 2012, prices had risen by 21.6 percent since the base period. the inflation rate in canada in 2013 was 1.1 percent. calculate the cpi in canada in 2013. hint: use the information that “prices had risen by 21.6 percent since the base period” to find the cpi in 2012. use the inflation rate formula (inflation is the growth rate of the cpi) to find cpi in 2013, knowing the cpi in 2012 and the inflation rate. the cpi in canada in 2013 is round up your answer to the first decimal. 122.9 130.7 119.6 110.5
Answers: 1
Do you know the correct answer?
Barnacle Industries was awarded a patent over 15 years ago for a unique industrial strength cleaner...

Questions in other subjects:

Konu
Social Studies, 01.12.2021 19:40
Konu
Social Studies, 01.12.2021 19:40
Konu
Physics, 01.12.2021 19:40
Konu
Mathematics, 01.12.2021 19:40
Konu
Mathematics, 01.12.2021 19:40