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I would like that you apply the model from chap 7 (A spatial approach to product variety 2): + For this purpose, assume the following:
I would like that you apply the model from chap 7 (A spatial approach to product variety 2): + For this purpose, assume the following: The willingness to pay of consumers is at maximum $10. The marginal costs are $2, the transport costs per unit is $1. The fixed costs to set up a store are $10,000 and the number of consumers is 1,000,000. Please have in mind the monopoly has the duty to serve the whole market. + t t C. What is the optimal number of stores? - D. Calculate what is the price and profit in the case that the optimal number of stores are opened
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