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Suppose you are advising Verizon on how to price their mobile phone contracts. There is only one consumer in the world and her demand is Q = 10 - P , where Q is the number of minutes demanded and P is the price per minute. The marginal cost of each minute is 0.
(a) If you charge a price per minute, what is the optimal price?
(b) If you charge a price per minute of 0, which is the optimal monthly fee? Assume that Q, minutes demanded, is a continuous variable.
Manufac Inc. produces industrial equipment using mainly Labor and Capital. It is currently using K = 1 (one unit of capital is 1000 machine-hour per day) and L = 20 (one unit of labor is 1000 man-hour per day). You estimated that its production function is Q = 100LK. The price per unit of labor is MCL = 20 ($000) and the price per unit of capital is MCK = 100 ($000).
(a) Is Manufac Inc. using the right mix of inputs? Should Manufac Inc. invest in more machines?
(b) Keeping output constant at 2000, how much labor and capital should Manufac Inc. choose?
Using the data provided above, determine if the Hernandez Corp. is using a cost minimizing combination of inputs. Explain your answer/show your work. If your answer is no, how should the input combination be adjusted?
Define and describe Insolvency Risk. Describe the two best protections against insolvency at a Financial Institution. Describe a situation where Insolvency Risk could be caused 1) by Liquidity Risk; 2) by Credit Risk
q1. jane wants to buy a beautiful doll as a gift for her sisters birthday. she knows that the same product is offered
If income changes from $200 billion to $300 billion, and consumption changes from $100 billion to $180 billion, what is the multiplier?
GDP and Economic growth of Australia during last S years and analyse Australian Government policy towards this. Which industries have been growing and reasons
From your analysis, craft a professional letter at least one page long to your state legislative representative recommending a beneficial change to the law. Or, if you believe no changes should be made, include detail on what portions of the law y..
Find the following probabilities. Assume the variable is normally distributed. a. What is the probability that someone spends less than $95?
By signing a trade agreement illustrate what does this imply as regards international trade theory of the Ricordian model.
If deficit spending "crowds out" some private investment, could future generations be worse off? If external financing eliminates crowding out, are future generations thereby protected?
You owe $350 a month on a 5 year car loan financed at %6 per month compounded monthly. What is the single amount value the dealer receives at the end of the loan?
Why do five pillars of Islam make it an ideal religion for a nomadic people. Why did African rivers turn out to be a disappointment to European colonial powers.
"The ad regulator has banned a Peugeot ad that showed a man reading a text while driving, which it says is in breach of the Highway Code."
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