Fite's footballs currently operates four stock points in north texas these stock points are identical in every respect including annual demand. a sporting goods consultant recently suggested the fite football company should increase the number of stock points to nine to improve customer service the increase in stock points is not anticipated to change total annual demand for the company the nine stock points would be identical in every respect inckuding annual demand (di) you have been asked by the vp of operations to determine how this will affect total annual ordering and holding costs for items held in inventory total annual ordering and holding costs today are $1,000,000 what do you anticipate the total annual ordering and holding costs will be under the proposal with 9 stock point locations? a. $1,000,000 b. $1,500,000 c. $2,000,000 d. $4,000,000 e. $9,000,000

Suppose that two firms produce differentiated products and compete in prices. as in class, the two firms are located at two ends of a line one mile apart. consumers are evenly distributed along the line. the firms have identical marginal cost, $60. firm b produces a product with value $110 to consumers.firm a (located at 0 on the unit line) produces a higher quality product with value $120 to consumers. the cost of travel are directly related to the distance a consumer travels to purchase a good. if a consumerhas to travel a mile to purchase a good, the incur a cost of $20. if they have to travel x fraction of a mile, they incur a cost of $20x. (a) write down the expressions for how much a consumer at location d would value the products sold by firms a and b, if they set prices p_{a} and p_{b} ? (b) based on your expressions in (a), how much will be demanded from each firm if prices p_{a} and p_{b} are set? (c) what are the nash equilibrium prices?