When Braeburn Publishing priced its poetry book at $5, it sold 5 books, and when it priced the volume at $8, it sold 4 books. You can calculate that its revenues were higher with the higher price. Suppose that, from further test marketing, this firm determines that it faces the demand curve described by the […]
Suppose that two oligopolistic retail chains are considering opening a new sales outlet in a particular town. The changes to each firm’s profits, depending on the actions taken, are given in the following payoff matrix. If a chain does not open a new outlet, it earns no addition to profits. If one of the chains […]
On January 1, 2005, a three-decades-old system of global quotas that had limited how much China and other countries could ship to the United States and other wealthy nations ended. Over the next four months, U.S. imports of Chinese-made cotton trousers rose by more than 1,505% and their price fell 21% in the first quarter […]
Argentines love a sizzling steak, consuming twice as much per capita as U.S. citizens. Thus, when the price of beef started to shoot up, Argentina’s President Nester Kirchner took dramatic action to force down beef prices. (Larry Rohter, “For Argentina’s Sizzling Economy, a Cap on Steak Prices,†New York Times, April 3, 2006.) He ordered […]
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