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Assume that Ford Motor Company can produce an automobile at a constant marginal cost of $4,000. The demand for the car in the Rochester area is P = 60,000 - 100Q.
a. What is the profit-maximizing price and quantity? What are the profits from this activity?
b. Now suppose that Ford sells its cars through an independent distributor, Rochester Autos, which has the exclusive right to sell new Fords in the Rochester area. Under the contract, Ford sets the wholesale price, and Rochester Motors selects the quantity to purchase and the retail price. The only cost facing Rochester Motors is the wholesale price of the car. Ford and Rochester Autos both strive to maximize their own profits. What are (1) the wholesale price, (2) the retail price, (3) the quantity sold, and (4) the combined profits of Ford and Rochester Autos?
c. Describe how Ford might use a two-part pricing scheme to eliminate this successive monopoly problem with Rochester Motors. (No calculations are necessary.)
Show the effect of dollar appreciation and depreciation with the euro on the price of U.S. exports and imports.
The Herschel Candy Corporation produces a single product, a chocolate almond bar that sells for $.40 each bar. The variable expenses for each bar total $.25.
The total monthly cost for marketing this product is composed of $3000 additional administrative expenses and $50 each unit for production and distribution costs.
Explain whether it would be desirable to have zero unemployment.
Mid-Atlantic Cinema, runs a chain of movie theaters in east central states and has enjoyed great success with a Tuesday Night at the Movies promotion.
1.Why are both the price elasticity of demand and the price elasticity of supply likely to be greater in the long run?
Company B has invested 5-years and $6 million in creating a new product. Even now, it is not clear whether product can compete profitably in the market.
Utech Corporation bottles and distributes Livit, a diet soft drink. The beverage is sold for 50 cents per sixteen ounce bottle to retailers, who charge customers 75 cents per bottle.
Go to the website http:// www.fin.gc.ca. Click on "Budgets", then on "Archived Budget Documents", then on "2009", and finally on "Budget in Brief.Is the reasoning presented consistent with the model.Does knowlege of the model help you understand this..
The Zumwalt Corporation is expected to pay a dividend of $2.25 a share at the end of the year, and that dividend is expected to increase at a constant rate of 5.00 percent per year in the future.
1. Why do banks hold a range of assets of varying degrees of liquidity and profitability?
The Quik Service Walk In Clinic always has three M.D. and 8 R.N.s working at its 24 hour clinic, which serves consumers with minor emergencies and ailments.
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