Attachment # 00008414 - Pricing_of_Multiple_Products(1)-2.xlsx

Pricing_of_Multiple_Products(1)-2.xlsx (11.98 KB)
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Pricing of Multiple ProductsParametersValuesa1b1a2b2Product 1Product 2q1=a1-b1*p1+d1*p2q2=a2-b2*p2+d2*p1d1d2Profitp1p2price of good 1price of good 2q1q2DemandMulti-Product Monopoly=p1_*q1_=p2_*q2_=p1_*q1_+p2_*q2_Analytical solutionTotal profit=(2*a1_*b2_+a2_*(d1_+d2_))/(4*b1_*b2_-(d1_+d2_)^2)=(2*a2_*b1_+a1_*(d1_+d2_))/(4*b1_*b2_-(d1_+d2_)^2)Profit *********************************************************************************************************************************************************=(a2_+d2_*p1_)/(2*b2_)=(a1_+d1_*p2_)/(2*b1_)Would a monopolist selling two products (Product 1 and Product 2) charge higher or lower prices than two independent firms selling these products?Product 1 sold by Firm 1Product 2 sold by Firm 2Goal Goalp1=p1(p2)p2=p2(p1)Analytical solution Equilibrium p1Equilibrium p2=(2*a1_*b2_+a2_*d1_)/(4*b1_*b2_-d1_*d2_)=(2*a2_*b1_+a1_*d2_)/(4*b1_*b2_-d1_*d2_)Analytical solution BR1Analytical solution BR2(Best Response of Firm 1)(Best Response of Firm 2)

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Managerial Economics HW

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Subject: Economics
Due on: 12/07/2015
Posted On: 12/07/2015 02:15 PM

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Hi, this is a problem set from managerial economics that I need solved. It is due tonight. I appreciate your help
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