New answers tagged price
4
Let $K:=y-(f+fa)-(t+ta)x$, and so $c=K-pq$.
From condition $(\mathrm{A1})$,
\begin{align}
&&\frac{v_q(\cdot)}{v_c(\cdot)}&=p \\
\quad\Rightarrow\quad &&
\frac{\alpha[K-pq]^{1-\alpha}q^{\alpha-1}}{(1-\alpha)[K-pq]^{-\alpha}q^\alpha}&=p \\
\quad\Rightarrow\quad &&
pq&=\alpha K \\
\quad\Rightarrow\quad &&
q&=\frac{...
2
Becker, G. S. (1991). A note on restaurant pricing and other examples of social influences on price. JPE.
4
Upward sloping demand curves are rare but they can exist for a class of a good that is called Giffen good.
Upward sloping demand can exist because price of a good or service has two effects:
Substitution Effect: Higher price of a good means that people will rather buy something else.
Income Effect: Higher price means peoples budget constraint is tighter.
...
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