In the Hotelling Model,what Effect Would an Increase in the Transportation

question 9

Multiple Choice

In the Hotelling model,what effect would an increase in the transportation cost t have on,in the first instance,a monopoly firm and,in the second instance,two firms located at the extremes of the line segment who compete over the marginal consumer?

• A)The monopolist's profit would decrease but the duopolists' would increase.
• B)Both monopolist's and duopolists' profits would increase.
• C)Both monopolist's and duopolists' profits would decrease.
• D)The monopolist's profit would increase but the duopolists' would decrease.

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Definitions:

Centrioles

Cylindrical structures in animal cells that play a crucial role in organizing microtubules during cell division.

Cytoskeleton

A complex network of interlinking filaments and tubules that extend throughout the cytoplasm in cells, providing structure and facilitating movement.

Structural Components

The physical parts or elements that make up an object, system, or organism, providing it with stability and form.

Microfilaments

Small, rod-like structures present in the cytoplasm of all eukaryotic cells, composed mainly of the protein actin, and involved in various forms of cell movement and in the maintenance of the cell's shape.