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Question: The World's Largest Airline United Airlines and Continental Airlines announced a $3 billion merger to create the world's biggest airline. The new airline will be able to better compete with low-cost domestic and foreign airlines. Travellers could face higher fares although the merged airline has no such plans. But one rationale for any merger is to cut capacity.
a. Explain how this airline merger might (i) increase air travel prices or (ii) lower air travel production costs.
b. Explain how cost savings arising from a cut in capacity might be passed on to travellers or boost producers' profits. Which might happen from this airline merger and why?
Explain the MC=MR Rule. Describe the market structures to which this rule applies. Create a chart to illustrate the data in Columns 9 and 10. Describe the profit maximizing (or loss minimizing) output for this firm.
ZZZ, Inc. operates in a monopolistically competitive industry. Its demand curve can be written as P = 160 - Q and its short run total cost curve is equal to TC = 1000 + Q^2. What is the rate of output that maximizes ZZZ, Inc.'s short run profits
Explain the effects of an import quota on domestic production, consumption, and price. The response must be typed, single spaced.
Construct a comparative bar chart for the average verbal and math scores for the three language groups. Write a few sentences describing the differences and similarities between the three language groups as shown in the bar chart.
Describe the equal marginal principle. Explain why this principle may not hold if increasing marginal util- ity is associated with the consumption of one or both goods.
Describe the components of the working age population. What would happen to the unemployment rate? Assume that the number of people unemployed does not change.
why might a favorable change in the economy such as technological improvement or a decrease in the price of imported
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Major cities around the world compete with each other in an effort to attract new businesses. Some of the criteria that businesses use to judge cities as potential locations for their headquarters might include the labor pool; the environment i..
Many police officer positions being advertised today require the applicant to have a college degree even though the tasks of a police officer rarely call upon college course material. Why don’t police departments increase their applicant pool by drop..
Which of the following is an example of discretionary fiscal policy - If the Congress and the president want to keep real GDP at its potential level in 2014, they should buy Treasury securities.
What is the market clearing real interest rate - Explain how this strategy of raising inflationary expectations is supposed to stimulate output.
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