Assume the disney company was experiencing above normal

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Reference no: EM1327048

Normal Profits

1. Suppose the Disney Company was experiencing above-normal profits. What would you predict would happen over time?

2. Explain why a proposed merger between Staples and Office Max was not allowed by the Department of Justice?

3. Smokers impose negative externalities on nonsmokers. Suppose the airspace in a restaurant is a resource owned by the restaurant owner.

a. How ould the owner respond to the negative externality caused by smokers?

b. Suppose smokers own the airspace. How would that change matters?

c. If the government gives ownership of the air to nonsmokers, would that change matters?

d. What does a ban on smoking in the restaurant do?

Reference no: EM1327048

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