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ECS3830 Business Competition and Regulation
Task:
Question:
Question 1 [5 points]
Explain how strategic product differentiation can be used as an entry-deterring strategy.
Question 2 [5 points]
Which indicator of performance explains the concept of abnormal profits, and clarify the views on that concept.
What are the objectives of the field of industrial organisation?
What are the limitations of the structure-conduct-performance (SCP) paradigm?
Show clearly all stages leading to the answer wherever necessary
i) Gini coefficient [2.5 points]
ii) The Herfindahl-Hirschman index [ 2.5 points]
iii) N-firm concentration ratio CR3 and CR5 [ 5 points]
Suppose Firm A behaves as a Stackelberg’s leader and firm B as its follower, in an industry producing a product, assuming that marginal cost of production of each firm zero, the demand function of the market is describe as followed : 2
ECS3830 Business Competition and Regulation
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Tellus molestie nunc non blandit massa enim nec dui. Tellus molestie nunc non blandit massa enim nec dui. Ac tortor vitae purus faucibus ornare suspendisse sed nisi. Pharetra et ultrices neque ornare aenean euismod. Pretium viverra suspendisse potenti nullam ac tortor vitae. Morbi quis commodo odio aenean sed. At consectetur lorem donec massa sapien faucibus et. Nisi quis eleifend quam adipiscing vitae proin sagittis nisl rhoncus. Duis at tellus at urna condimentum mattis pellentesque. Vivamus at augue eget arcu dictum varius duis at. Justo donec enim diam vulputate ut. Blandit libero volutpat sed cras ornare arcu. Ac felis donec et odio pellentesque diam volutpat commodo. Convallis a cras semper auctor neque. Tempus iaculis urna id volutpat lacus. Tortor consequat id porta nibh.
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