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1. Donut Ville caters to its retirement population by selling over 10,000 donuts each week. To produce that many donuts weekly, DonutVille uses 1,000 pounds of flour, which must be delivered by 5:00AM every Friday morning. How should the manager of DonutVille acquire flour? Explain.
2. Teletronics reported record profits of $100,000 last year and is on track to exceed those profits this year. Teletronics competes in a very competitive market where many of the firms are merging in an attempt to gain competitive advantages. Currently, the company's top manager is compensated with a fixed salary that does not include any performance bonuses. Explain why this manager might nonetheless have a strong incentive to maximize the firm's profits.
Suppose that ranchers can buy up to a collective total of 200 cows and run them on the open range. The value of each cow after it has grazed is given by V= $2000-10C, where C is the total number of cows on the range.
What would be the dollar value of the recessionary gap What would be the potential GDP number corresponding to a natural rate of 7% What would be the value of the expansionary gap
You are buying a new car for $20,000. You signed a contract for the loan for 4 years. Your loan has an interest rate of 12% interest (APR). You make monthly payments and the interest is compounded monthly.
Timmy currently has $100 to last him a whole weekend. Let T represent his consumption on Saturday, and N represent his consumption on Sunday. His utility function is given by U(T,N)=min(T,3*N). How much of his $100 will Timmy choose to spend on Su..
A firm has the opportunity to invest in a project having an initial outlay of $20,000. Net cash inflows (before depreciation and taxes) are expected to be $5,000 per year for five years. The firm has a marginal income-tax rate of 40%.
PA = 9.6 - 0.08QA PCS = 4 - 0.05QCS where PA is the adult prices, PCS is the child/senior citizen price, QA is the adult quantity and QCS is the child/senior citizen quantity. Crowding is not a problem at the museum, and so managers consider a mar..
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.
Show how the payoff matrix in the table for Problem 10 might change if firm A were to make a credible threat to lower the price by building excess capacity to deter frim B from entering the market. (a) indicate the best strategy for each firm.
A firm with market power has an individual consumer demand of Q = 20 - 4P and costs of C = 4Q. What is the optimal price to charge for a block of 20 units
Suppose a monopolist charges a price of $27 for its product and sells 10 units at that price. At 10 units of production the firm has average fixed cost equal to $10 and average variable cost equal to $12. How much total profit is the firm earning ..
Q = 123 - 0.5P - 0.25 Pc + .01 Y where Q is the quantity of seasonal passes sold, P is the price for seasonal pass, Pc is the average price for concession items, and Y is average per capital income in Mapleville. what is the profit maximizing pric..
The construction of a dam will cost $1,000 at time 0, $500 in year 1, $500 in year 2. It will be completed at the end of year 2. Beginning in year 3, maintenance costs will be $100 per year through year 10. From years 11 on, maintenance costs will..
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