Difference between average revenue and marginal revenue

Assignment Help International Economics

Reference no: EM1375170

Question1. This question deals with demand and supply and refers you to the table below:
a. Given the table, respond to the questions below. It may be helpful to graph the data as you respond to the questions.

Price Quantity Demanded/Month Quantity Supplied/Month
$5 6,000 10,000
$4 8,000 8,000
$3 10,000 6,000
$2 12,000 4,000
$1 14,000 2,000

b. What is the equilibrium price and equilibrium quantity?
c. Suppose the price is currently at $5. What problem would exist in the economy? What would you expect to happen to price?
d. Suppose the price is currently $2. What problem exists in the economy? What would you expect to happen to price?

Question2. Explain the demand and supply factors for rising health care costs in the United States.
Hint: The supply and demand should correlate.

Question3. Explain the difference between average revenue and marginal revenue. Why are both of these revenue measures important to a profit-maximizing firm?

Question4. Explain how a firm in a competitive market identifies the profit-maximizing level of production. When should the firm raise production, and when should the firm lower production?

Question5. In many countries, the government chooses to "internalize" the monopoly by owning monopoly providers of goods and services. (In some cases these firms are "nationalized" and the government actually buys or confiscates firms that operate in monopoly markets). What would be the advantages and disadvantages of such an approach to ensuring the "best interest of society" is promoted in these markets? Carefully explain your answer.

Question6. In many college towns, private independent bookstores typically locate on the periphery of the college campus. However, in some college towns, the University has used political power to restrict private bookstores near campus through community zoning laws. Use your knowledge of markets to predict the price and quality of service difference in the market for college textbooks under these two different market regimes.

Question7. Explain the difference between absolute advantage and comparative advantage. Which is more important in determining trade patterns, absolute advantage or comparative advantage? Why?

Question8. How does an import quota differ from an equivalent tariff?

Question9. Describe the difference between a diminishing marginal product of labor and a negative marginal product of labor. Why would a profit-maximizing firm always choose to operate where the marginal product of labor is decreasing (but not negative)?

Question10. The National Collegiate Athletic Association (NCAA) has long argued that nationally-prominent college athletes are compensated with an investment in human capital that far exceeds the monetary reward of playing professional sports. Examine this argument in light of your knowledge of human capital theory and the economic theory of labor markets.

Reference no: EM1375170

Questions Cloud

Explain why do inventories cost so much to maintain : Explain why do inventories cost so much to maintain. Give some examples of explain how cost is associated with carrying an inventory. Is re anything we can do to lower this cost and if so, illustrate what.

Illustrate what is appropriate reorder point : daily demand for a product is approximately normally distributed with a mean of 138 and a standard deviation of 24 units. Order lead time is 9 days. Illustrate what is appropriate reorder point (in units) if target service level is 82%.

Compute ld score and compare it to ld scores computed : Use trial and error to find out a better layout for Fresh Foods Grocery. Compute LD score and compare it to LD scores computed for Fresh Foods' current and proposed layouts. Which is best

Illustrate what action should la conya have taken : Louisa, a manager, is responsible for creating a team for development of a new product. Which of subsequent is most important for Louisa, if she needs to create synergy in this team.

Difference between average revenue and marginal revenue : Explain the difference between average revenue and marginal revenue. Discuss why are both of these revenue measures important to a profit-maximizing company?

Examine supply chain of any cocoa processing business : Examine Supply Chain of any cocoa Processing Business discussing Challenges and outline strategic directions to make it more competitive.

Illustrate what type of team would work best : Illustrate what type of team would work best in this situation. Support your answer with concepts from text that applies to this proposed venture.

Fairness in foreign trade : If we do engage in foreign trade, should we bound foreign trade to country's that engage in fair trade throgh giving us access to domestic markets and reciprocal import tariff decrease that mirror our tarriff reductions on our imports from them?

Discuss how transportation managers should be involved : Discuss how transportation managers should be involved with or operations of firm. Please support your answer with an example.

User Account

All Pages