What proportion of annual salary will be economic rent

Assignment Help Microeconomics
Reference no: EM13112169

The City of New Orleans has 200 adverstising companies, 199 of which employ designers of normal ability at a salary of $100,000 a year.

Paying his salary, each of the 199 firms makes a normal profit on $500,000 in revenue. However, the 200th company employs Janus Jacobs, an unusually talented designer. This company collects $1,000,000 in revenues because of Jacobs talent. How much will Jacob earn? What proportion of his annual salary will be economic rent? Why won't the advertising company for which Jacobs works be able to earn an economic profit?

Reference no: EM13112169

Questions Cloud

Compute expected value of thief-s initial wealth : If he succeeds he will obtain 2000 US dollars. suppose that thief currently has 1500 US dollars in his pocket. Compute expected value of this undertaking.
Calculating the density of lead : Lead has a face-centered cubic lattice with all atoms at the lattice points and a unit-cell edge length of 495.0pm its atomic mass is 207.2 amu what is the density of lead?
Hypothesis and p-value of federal government : The federal government recently granted funds for a special program designed to reduce crime in high-crime areas. A study of the results of the program in eight high-crime areas of Miami, Florida, yielded the following results.
How do cell ultrastructures support this idea : Evolution is considered the unifying theme of biology. How do cell ultrastructures support this idea? Provide examples of modifications and specializations in specific types of cells.
What proportion of annual salary will be economic rent : How much will Jacob earn? What proportion of his annual salary will be economic rent? Why won't the advertising company for which Jacobs works be able to earn an economic profit?
Predict the protein will ultimately end up : If you remove the ER retention signal from a protein that normally resides in the ER lumen, where do you predict the protein will ultimately end up? Explain.
What is the frequency of the dominant allele : Cystic fibrosis is a recessive condition that affects about 1 in 2,500 babies in the Caucasian population of the United States.
What is the allele frequency of h : assume the population is in hardy weinberg equilibrium.
Comparing samples : The manager of a package courier service believes that packages shipped at the end of the month are heavier than those shipped early in the month.

Reviews

Write a Review

Microeconomics Questions & Answers

  Predict long-run adjustments in housing sector

What does your anticipated adjustment process imply about the CR for the construction industry?

  Determine price elasticity and income elasticity of demand

Determine the price elasticity, and income elasticity of demand and where Q denotes passengers in thousands per year, P the (average) ticket price, and I US national income.

  Construct the budget constraint for a consumer

Does Will's frequent buyer program have the same effect on the consumption of its bagels that would occur if it simply lowered the price of one dozen bagels by 3%? Explain.

  What is the long-run equilibrium market price and quantity

What is the long-run equilibrium market price and quantity and what is the long-run number of firms in the industry? How much does each produce? What are their profits?

  Cost function-avc-afc-atc and mc

An accountant for a car rental company was recently asked to report the firm's cost of producing various levels of output. What is the average fixed cost of producing 2 units of output? What is the average variable cost of producing 2 units of output..

  Labor markets; further applications of microeconomics

Labor Markets; Further Applications of Microeconomics objective questions and answers, When two goods are perfect complements, the indifference curves are

  Determining market situation

Describe a market situation in which the operating company faces economic difficulties and need to cut costs. What cost cutting strategies may the operating company employ to remain profitable?

  Solving agency problems

The Wall Street Journal article reported that large hotel chains, such as Marriott, are tending to decrease the number of hotels that they franchise to outside owners and raise number the chain owns and manages itself.

  Decisions of short run production-price decline

A firm produces 10 units per week at a price of $500 each. With AFC of $100 and AVC $350 per unit, the firm is earning economic profits of $500 per week.

  Determining linear programming-maximizing profits

A manufacturer of outdoor clothing makes wax jackets and trousers. Each jacket requires 1 hour to manufacture, whereas each pair of trousers takes 40 minutes.

  Intermediate products

What factors would cause a firm to decide to buy intermediate products needed for production of its final goods or services?

  Describe overhead cost discussion

Assume the following was overheard at the water cooler: "I think our medical device company should take advantage of economies of scale by increasing our output, thereby spreading out our overhead costs."

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd