Suppose that two book stores are located at a = 1/4 and b = 5/8. What is the point of market segmentation according to Harold Hotelling's model?
A)1/3
B)7/16
C)9/16
D)1/2

Question

Quizplus · Accepted Answer

The point of market segmentation according to Harold Hotelling's model is the midpoint between the two stores. To find this, calculate the average of a = 1/4 and b = 5/8: (1/4 + 5/8) / 2 = (2/8 + 5/8) / 2 = 7/16.

Suppose That Two Book Stores Are Located at a =