Use Figure 13-3 to answer the following questions. a. Would firm 1's profit increase or decrease if the equilibrium moved from point A to point B?
b. Would firm 2's profit increase or decrease if the equilibrium moved from point A to point B?
c. As the manager of firm 1, propose a strategy that would increase both the market share and the profits of firm 1-that is, a strategy that moves the market equilibrium from point A to point
B.

Question

Use Figure 13-3 to answer the following questions.  a. Would firm 1's profit increase or decrease if the equilibrium moved from point A to point B?
b. Would firm 2's profit increase or decrease if the equilibrium moved from point A to point B?
c. As the manager of firm 1, propose a strategy that would increase both the market share and the profits of firm 1-that is, a strategy that moves the market equilibrium from point A to point 
B.

Quizplus · Accepted Answer

The Answer of Use Figure 13-3 to answer the following questions.  a. Would firm 1's profit increase or decrease if the equilibrium moved from point A to point B?
b. Would firm 2's profit increase or decrease if the equilibrium moved from point A to point B?
c. As the manager of firm 1, propose a strategy that would increase both the market share and the profits of firm 1-that is, a strategy that moves the market equilibrium from point A to point 
B.

Use Figure 13-3 to Answer the Following Questions