Suppose securitex is a small firm that has developed a new anti-theft device for automobiles. securitex currently sells its device online and earns profit of $1515 million per year. gm is considering installing securitex's system on its automobiles. the two firms first, however, must bargain over what price gm will pay securitex for its software. gm chooses how much to offer securitex for its system and then securitex chooses whether to accept the offer and install its system on gm's automobiles. the strategies and corresponding profits for gm (gm) and securitex (sx) are depicted in the decision tree to the right. profits are in millions, and gm's payoffs represent the additional profit it can earn on its automobiles with securitex's anti-theft system. what is the subgame-perfect equilibrium

The leading producer of cell phone backup batteries, jumpstart, has achieved great success because they produce high-quality battery backups that are not too expensive. even so, another company that produces lower-quality batteries at the same price has also achieved some success, but not as much as jumpstart. also, in general, the price of backup batteries has declined because of economies of scale and learning. in addition, jumpstart has added complementary assets, such as a carrying case. considering all of these factors, the backup battery industry is most likely in the introduction stage. growth stage. shakeout stage. maturity stage.

In a perfectly competitive market, the long-run market supply curve tends to be horizontal or nearly so. what is another way to state this fact? (a) market supply is much more elastic in the long run than the short run. (b) in the long run, average total cost is minimized. (c) in the long run, price equals marginal cost. (d) market supply is much less elastic in the long run than the short run.

You are the owner of a local honda dealership. unlike other dealerships in the area, you take pride in your “no haggle” sales policy. last year, your dealership earned record profits of $1.5 million. however, according to the local chamber of commerce, your earnings were 10 percent less than either of your competitors. in your market, the price elasticity of demand for midsized honda automobiles is 4.5. in each of the last five years, your dealership has sold more midsized automobiles than any other honda dealership in the nation. this entitled your dealership to an additional 30 percent off the manufacturer’s suggested retail price (msrp) in each year. taking this into account, your marginal cost of a midsized automobile is $11,000. what price should you charge for a midsized automobile if you expect to maintain your record sales?