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You are the manager of a monopoly. A typical consumer's inverse demand function for your firm's product is P = 100 - 20Q, and your cost function is C(Q) = 20Q.
a. Determine the optimal two-part pricing strategy.
b. How much additional profit do you earn using a two-part pricing strategy compared with charging this consumer a per-unit price?
A monopolistically competitive firm produces a level of output at which price equals $80, marginal revenue equals $40, average total cost equals $100, marginal cost equals $40, and average fixed costs equals $10.
My paper firm generates a monthly profit of $500,000 as I dump a noxious affluent into the nearby river due to the absence of law or regulation. Your downstream brewery must therefore filter the water before it is used to make beer which, in turn,..
Suppose that Tommy Hilfiger's marginal cost of a jacket is $100 and at one of the firm's shops, total fixed cost is $ 2000 a day. The profit-maximizing number of jackets sold in this shop is 20 a day. Then the shops nearby start to advertise their..
Consider the following information below for Pat's Pizza Restaurant and answer the questions below: Marginal Product of Capital: 4,000 Marginal Produce of Labor: 100 Wage Rate: $10 Rental Price of Pizza Ovens: $500 a) Is the owner of Pat's Pizza Rest..
The company interest rate (MARR) is 15%. The company will make a down payment of 25% of the first cost for the Pick-M-Up and 15% of the first cost for Carter's. The loan will have an annual effective interest rate of 10% with annual payments.
Suppose the demand curve for a monopolist is QD = 500 - P and the marginal revenue function is MR = 500 - 2Q. The monopolist has a constant marginal and average total cost of $50 per unit. a. Find the monopolist's profit-maximizing output and price..
You employ five workers and deciding whether to hire an additional help. MPL of new hire is expected to be 500 units per week. The market wage rate for the skill you are looking for is $1200 per week.
You'll earn $0.50 on each bagel, $0.50 on each cup of coffee, and $1.00 on the other items. Salaries, equipment, and rent cost about $100,000 per year. What is the break-even quantity of bagels.
(1) Estimate the IRR for each project shown below to within X.X%. (2) Which ones should be done if the capital budget is limited to $60,000 (3) What is the minimum attractive rate of return (MARR) (4) What is the opportunity cost
find out the MRTS of the following questions for a. q=L^0.5K^0.5, b. q=L^0.5+K^0.5, c. q= min {K,L} and d. q=L+K. I think for the first two I have the correct answers and just need to make sure I didn't do the math incorrectly.
Suppose the simplified consolidated balance sheet shown below is for the entire commercial banking system. All figures are in billions. The reserve ratio is 25 percent. A. What amount of excess reserves does the commercial banking system have.
a) What would happen to the quantity demanded of cigarettes if income increases b) Are cigarettes a "normal" or "inferior" good c) What would happen to the quantity demanded if household income were to rise by 1% next year
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