An annual event created $100,000 positive cash ow this year. The cash ow is expected to grow by 2% per year, if it continues. The probability of this event to continue for every next year is 95%. Discount rate is 7%. Assume that the cash flows are generated at the end of each year and that if the ev
NiceCream, Inc. is a monopolist at the market of ice creams in town N. It enjoys the monopoly profit with the demand function given by D = 100 − P and constant marginal cost MC < 100. Another rm with the same technology is going to enter the market, in this case, the firms will compete by choosing t
The monopoly works in a market with demand curve Q = 1190/P7, its total cost function is given by TC = 2Q. The government decides that the firm must split into two, and these two firms will compete by simultaneously choosing prices. Assuming one-shot interaction, what is the percentage change of the
