Q1. How is the transfer price of an intermediate product determined when
(a) There is no external market for the intermediate product,
(b) A perfectly competitive external market for the intermediate product exists, and
(c) An imperfectly competitive external market for the intermediate product exists?
Q2. Suppose Demand function P= 240 -.20Q
Suppose Supply function p= 1/2Q + 100
Illustrate the quantity demanded at a price of $240?
Illustrate the consumer surplus if the price is $220?
Illustrate the quantity supplied at a price of $100?