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# Pricing and Output Decisions in an Oligopoly Assume you

Pricing and Output Decisions in an Oligopoly

Assume you are the manager of Yabba Cable Company, which provides commercial communication services to the town of Canyon Lake, Texas. Because of licensing restrictions in the market, only your company and two others (Dabba and Zabba) are allowed to operate in this market. The three companies decide to form a cartel and divide the market shares such that each company will provide services that will maximize its profits. The licensing restrictions allow each company to sell as much as it wants at a price ceiling of \$2,400. You have the following output and MC data for each company:

Output MC (\$)
Q Yabba Dabba Zabba
1,200 2,700 2,800 2,900
2,200 2,600 2,500 2,700
3,200 2,400 2,300 2,500
4,200 2,200 2,200 2,300
5,200 2,300 2,400 2,400
6,200 2,400 2,700 2,500

Calculate the industry output and market share at the current price of \$2,400, assuming the prices are stable and unlikely to change.

Assume the current prices in the market are challenged by the regulatory agency, resulting in a new maximum price of \$2,200. How will this change the industry output and market share for each company?

Is there any incentive for any company to cheat under either of the conditions in tasks a and b? Why or why not?
Create your report in a 2- to 3-page Microsoft Word document.

Submit your report to the W4: Assignment 2 Dropbox by Thursday, February 23, 2012.

Cite any sources using the APA format on a separate page.

Assignment 2 Grading Criteria Maximum Points
Calculated the industry output and market share at the current price of \$2,400, assuming that prices are stable and not likely to change. 10
Explained how the new maximum price changes the industry output and the market share for each firm in the cartel. 10
Analyzed and justified whether there is any incentive for any company to cheat under either of the given conditions. 10
Presented a structured document free of spelling and grammatical errors. 5
Properly cited sources using the APA format. 5

getsetgo :

Hello

getsetgo :

Thanks for requesting me. I did similar question with different figures in past. If you would like to use that as model, I will upload it here.

getsetgo :

I could write the answer with new figures, but that will require more time and effort than the price you are offering.

Customer:

If you answered this question before you can just upload that for me.

getsetgo :

Hello

getsetgo :

getsetgo :

getsetgo :

getsetgo :

getsetgo :

getsetgo :

you need to change the figure

Customer: replied 5 years ago.

Customer: replied 5 years ago.

I may not be able to open this because I am on my work computer. I will have to try and open this when I get home this evening.

Sorry for the confusion.

ok. Please modify the figure in excel.
Customer: replied 5 years ago.