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Business, 06.10.2019 07:30 mimigg0621

(3) von-thünen model with multiple cities there are two cities, a and b, where b is located 20 miles east of a. both produce an identical good and consumers’ wtp=15 is the same everywhere. marginal transportation cost is identical tb=ta=1. each city prices its good at marginal cost. we know that cb=3; ca is unknown. a) what is the maximum market reach of city b to its west? (2 pts) b) now assume there are unserved customers to the west of b (i. e., between a and b). calculate the minimum ca for this to be true. (6 pts)

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(3) von-thĂĽnen model with multiple cities there are two cities, a and b, where b is located 20 miles...
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