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Suppose an auto manufacturer sells cars at $10,000 per car. Marginal costs are $5,000 per car. The vice president in charge of sales and marketing says that one month sales with discounts of 10% typically increase sales by roughly 80% during the sale, suggesting a demand elasticity of -8. You advise her to lower her prices on a permanent basis. She responds that her cars are durables and she is worried that she is "stealing" customers and shifting demand from the future. Does she have a point?
What is the role of the federal reserve? When and why does the federal reserve increase and decrease interest rates?
What does it mean to be a carrier of a genetic defective characteristic? When might it be important to know if one is a carrier?
A drug patent gives a pharmaceutical firm a monopoly. Draw and label the supply and demand curves for a drug. Then demonstrate how having a monopoly changes that equilibrium. How does this impact consumer surplus? What actions can the government take..
Consider a two-period economy with a single commodity (say leisure): x_1 is the consumption of leisure in period 1, and x_2 is the consumption of leisure in period 2. When Peter evaluates consumption streams, he cares only about the best time in his ..
In 1974, the U.S. attorney general filed suit against which telecom company for violating antitrust laws?
Steve believes that Monica has a 25% chance of be Illustrate what is Steve's expected utility from buying.
A firm operating in a perfectly competitive industry is producing a daily output which supports total revenue equal to $5,000. That output is its profit-maximizing output. The firms average total cost is $8, its marginal cost is $10, and its average ..
Ann Page Corporation has fixed expenses of $30,000 per year. Variable expenses per unit are $17. Sales price per unit is $30.
Evaluate the financial performance of the automotive segment of GPC from 2007 to 2011.
How capital gains and percentage returns are calculated?
Describe the ways in which international business has changed over the last 50 years. Include the concepts of an MNC and the different types of foreign investment. Give specific examples.
The firms and workers in Bayernland form expectations rationally. The firms and workers in Realland form expectations adaptively. Their otherwise identical economies are initially in equilibrium at the natural level of output with 6 percent inflation..
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