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Ginny and Lucia are debating the use of coupons by grocery stores. Ginny says, "The use of coupons in grocery stores represents a means of price discrimination. It's pure and simple. Coupons do reduce the price of groceries, but mostly to people who are less likely to buy at the full price." By contrast, Lucia contends, "Coupons do not constitute price discrimination. They simply represent a way of temporarily changing the prices of some grocery items. Coupons reduce the price for everyone, not just for those who are price sensitive." Economists generally agree with
Describe the various forms of direct response advertising. Discuss some of the reasons for the success of direct response advertising.
Given a firm’s revenue and cost functions: Construct a profit function, determine the level of Q that maximizes profits, and prove that it is a maximum by invoking the second-derivative test
illustrate what cost-minimizing combination of K and L will the manufacturer employ for the output levels in part a.
What is the cross price elasticity with respect to good x? What does the sign of the coefficient tell us? Interpret your results.
Based upon a monthly payment, which one is a better deal on the same $9000 car? 9% interest on the full amount for 48 months, compounded monthly.
Briefly discuss the impact of rational self-interest on each of the following decisions. Whether to attend college full time or enter the workforce full time.
Bill gets utility from consuming food (F) and clothing (C) represented by the following utility function: U(F,C) = FC + F. The price of food is $1 per unit and the price of clothing is $2 per unit. Bill’s income is $22. Graph Bill’s budget constraint..
Imagine that you are a lobbyist for timber, an established industry suffering from low-priced foreign competition, and you are trying to get Congress to pass trade restrictions. Which two or three of the five arguments do you think would be most pers..
What can be accomplished about the impact of transportation costs on the price of the traded product in each trading nation.
In order to rule on a potential federal grant, a government official must confirm that the average income in a Pennsylvania county is less than $12,500. A sample of 35 individuals is taken and shows a sample mean of $10,950 and a sample standard devi..
M is the average income in the United States. What could be the impact on your rm.
You have two sets of estimates of national account numbers for a closed economy for next year. In the first set, government expenditures will be $30 billion, transfer payments will be $10 billion, and taxes will be $45 billion. Based on these numbers..
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