dse 2013 doubt.help.

[Aish]

The next TWO questions are based on the following model:
Suppose that there are two goods, which are imperfect substitutes of each other. Let p1, p2
denote the price of good 1 and good 2, respectively. Demand of good 1 and
good 2 are as follows
D1(p1, p2) = a - p1 + bp2; D2(p1; p2) = a - p2 + bp1
where a > 0 and 1 > b > 0. Both of the goods can be produced at cost c per
unit.
QUESTION 7. Find the equilibrium prices, when good 1 and good 2 are
produced by two different monopolists.
(a) p1 = p2 = a+c/2-b

(b) p1 = p2 = a+c/1-b

(c) p1 = a+c/2-b, p2 = a+c/1-b

(d) p1 = a+c/1-b,  p2 = a+c/2-b

QUESTION 8. Find the equilibrium prices, when both the goods are pro-
duced by single monopolist.
(a) p1 = p2 = a+c-bc/2-b

(b) p1 = p2 = a+c-bc/1-b

(c) p1 = p2 = a+c-bc/2(1-b)

(d) p1 = p2 = a+c-bc/2.  

Please someone explain or show their working for the second part.I'm not getting the answer :/ :(

[The Villain]

Hi Ash
Add the 2 dd curves
u'll get
q=a-p+bp
maximise it and use condn MR=MC then...u'll get it :)

[Arushi :))]

[Shefali]

Guys help me with question 7 also..

[Arushi :))]

[Aish]

Ron, Thanks! :')
Arushi, Great work .Thanks alot! ^_^

[mrittik]

Q7. Shefali you make it p1 & p2....so u have change p1 & p2 in the fn of y1 & y2 resp.....then pie1 & pie2..u have to maximize profit...understood?

[Aranya]

How to do qsn 24 from the same paper.not getting it!

[mrittik]

okies Aranya see it another way....f(1)=8 whr x=1, f^(-1)'(8) is needed....so we have to find f'(x)=6x^5+20x^3.....f^(-1)'(8)=1/(6x^5+20x^3) whr x=1 then .f^(-1)'(8)=1/26