What is the problem if the government decides to regulate production at Q1?

Using the old method to solve for the Herfindahl Index, why would the government frown upon the scenario below? Firms Market Share A 19 B 18 C 18 D 18 E 9 F 9 G 9

A Price Ceiling is meant to help consumers.  Why is it placed below the Equilibrium Point?  

The absolute price of a luxury watch is $10,000.  The absolute price of a laptop  is $800.  a. Find the relative price of a laptop in terms of a luxury watch. b.  Give me the interpretation of your answer in A.  What is your answer in letter A really telling us?   Here is the formula that you will need:   Rel price of a laptop (in terms of a watch) =   Absolute price of a laptop —————————— Absolute price of a watch 

Refer to the table below.  Using the new method to solve for the Herfindahl Index, would the government consider the scenario above acceptable?  Show your solution.  No solution, no credit.  Firms Market Share A 19 B 18 C 18 D 18 E 9 F 9 G 9

According to the textbook, when applied to Speed Limit Laws, why does Game Theory – Prisoner’s Dilemma have a different outcome as opposed to cutting down on nuclear weapons?  Both parties (those who abide by the speed laws and those who do not abide by the speed laws) agree to obey the speed laws.  Explain why.

Why does a Monopolistically Competitive firm operate in Point A, as opposed to a Perfectly Competitive firm, which operates in Point L (see graph below)?

According to the textbook, why are Cartels flawed such that they do not last long, or are ineffective in the long run?

Solve for letters A, B, and C. Q TFC AFC TVC AVC TC ATC MC 0 1000 X 0 X   X X 20 1000   70         40 1000   110 B       60 1000   140         80 1000   160     A   100 1000   200         120 1000 C 240           Formulas:  MU = change in TU / change in Q MPP of Labor = change in Q / change in L TC = TFC + TVC        or        TC = ATC x Q MC = change in TC / change in Q AFC = TFC/Q AVC = TVC/Q ATC = TC/Q      or     ATC = AFC + AVC TR = P x Q (that’s Price x Quantity) MR = change in TR / change in Q Profit / Loss = TR – TC TVC = AVC x Q

  Assume this firm is trying to maximize Profit under Perfect Competition.  How much is its Profit or Loss?  Show your solution.   Formulas:  MU = change in TU / change in Q MPP of Labor = change in Q / change in L TC = TFC + TVC        or        TC = ATC x Q MC = change in TC / change in Q AFC = TFC/Q AVC = TVC/Q ATC = TC/Q      or     ATC = AFC + AVC TR = P x Q (that’s Price x Quantity) MR = change in TR / change in Q Profit / Loss = TR – TC TVC = AVC x Q