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BUSINESS AND INDUSTRIAL ECONOMICS [G-O] Final exam June 21st 2023 NAME AND SURNAME ________________________________________________________________ STUDENT ID________________________________________________________________ Multiple choice questions 1) Consider a Bain, Sylos Labini and Modigliani model with absolute cost advantages. In industry A, the market price is 50. In industry B, the market price is 80. All other things equal, what does this imply? a) Incumbents in industry A have higher costs than incumbents in industry B. b) The threat of new entrants in industry B is a priori higher (before considering market price). c) Entry barriers in industry B are higher. BONUS d) All the other options are correct. 2) Firms A and B are competing according to a Stackelberg oligopoly. The inverse demand function is P = 250 – 2Q. The total cost function for both firms is TC = 5 + 2q. What is the quantity produced by the follower? a) 31. BONUS b) 62. c) 124. d) None of the other answers is correct. 3) Please gauge the validity of the following statements: a) In principle, the double marginalization problem should require the intervention of ex-ante regulation in order to be solved. b) In principle, the double marginalization problem should not require any regulatory intervention in order to be solved. BONUS c) In principle, the double marginalization problem should require the intervention of ex-post regulation (i.e. antitrust) in order to be solved. d) In principle, the double marginalization problem should require the intervention of both ex- ante and ex-post (i.e. antitrust) regulation in order to be solved. 4) Consider a monopolist with demand Q = 280 – 4p and marginal cost MC = 50. There are no fixed costs. Determine the difference in social welfare between these two…