Will that price lead to the ancient number of crossings

Assignment Help Econometrics
Reference no: EM131209592

A company is considering building a bridge across a river. The bridge would cost $3 million to build and nothing to maintain. The anticipated demand over the lifetime of the bridge is x = 800 - 100p, where x is the number of crossings (in thousands) given the price per crossing p.

a. If the company builds the bridge, what will be the profit-maximizing price?

b. Will that price lead to the ancient number of crossings? Why or why not?

c. What will be the company's profit or loss? Should it build the bridge?

d. If the government were to build the bridge, what price should it charge?

e. Should the government build the bridge? Why or why not?

Reference no: EM131209592

Questions Cloud

How do pension funds use assets in their portfolios : How do pension funds ‘use' assets in their portfolios? - How does this depend on the degree of maturity of the pension fund?
Analyze the difference between primary and secondary markets : Describe the role of the financial institutions and financial markets in our economy. Differentiate between primary and secondary markets. Differentiate between money and capital markets.
Main asset characteristics that pension funds will consider : What are the main asset characteristics that pension funds will consider when selecting their investment portfolios?
Compare that amount to the total deposits : At age 19,someone sets up an IRA (individual retirement account) with an APR of 4%.At the end of each month he deposits $100in the account. How much will the IRA contain when he retires at age 65? Compare that amount to the total deposits made ove..
Will that price lead to the ancient number of crossings : A company is considering building a bridge across a river. The bridge would cost $3 million to build and nothing to maintain. The anticipated demand over the lifetime of the bridge is x = 800 - 100p, where x is the number of crossings (in thousand..
Provide an analysis of another companys risk tolerance : Provide an analysis of your employer's or another company's risk tolerance and risk exposure. Include the impact this tolerance and exposure may have on potential outcomes.
Would this genetic testing help or hurt : Would it exacerbate or mitigate the problem of adverse selection in the health insurance market? Would it increase or decrease the number of people without health insurance? Would it be a good thing?
What is the operating cash flow : Comm203: Introductory Corporate Finance - What is the operating cash flow and determine the value of the terminal loss or recapture at the end of year. Discuss the consequences of the loss or recapture.
Why there is asymmetric information : Consider each of the following situations involving moral hazard. In each case identify the principal (uninformed party) and the agent (informed party) and explain why there is asymmetric information. How does the action described for each situati..

Reviews

Write a Review

Econometrics Questions & Answers

  How will the turtle firm respond to the threat of entry

Draw a game tree like the one shown in Figure 27.10 on page 588 and predict the outcome of the game. How will the turtle firm respond to the threat of entry? Will the frog firm enter the market?

  How much a worker can inventory

Computers cost $125 each and you must pay each worker $30 per hour.

  What is the cost southafrican government providing and whom

what is the cost SouthAfrican government providing and to whom?

  Does total investment increase or decrease in this case

Does total investment (public and private) increase or decrease in this case?

  What is the payback period for the software

An engineering department is considering purchase of an advanced computational fluid dynamics software system to enhance productivity. the initial cost of the software is $55,000 but is expected to result in efficiency savings of $25,000 the first..

  Calculate the amortization schedule

An engineer wanted to celebrate graduating and getting a job by buying $2,400 of new furniture. Luckily the store was offering six-month financing at the low interest rate of 6% per year compounded monthly. Calculate the amortization schedule.

  What is probability that the survey will provide a sample

People end up tossing 12% of what they buy at the grocery store (Reader's Digest, March, 2009). Assume this is the true population proportion and that you plan to take a sample survey of 540 grocery shoppers to further investigate their behavior.

  Determine what price katrina''s candies should charge

Determine the quantity that would be produced at this price and the maximum profit possible.

  What should an investor buy to yield the largest steam

You are given the following information on the bond market: Money available on January 1, 2004: one thousand dollar interest rates on January 1, 2004, on bonds of different maturities: 1 year, 4%; 2 year, 5%; 3 year, 5.5%; 4 year, 6%

  Jack and his male colleagues make indelicate jokes

Illegal discrimination results from behaviors or actions by an organization or managers within an organization that cause members of a protected class to be unfairly differentiated from others.

  What is the impact of higher rate of technological progress

Prove that the steady-state equilibrium is unique and globally (saddle-path) stable. What is the impact of a higher rate of technological progress?

  What is the elasticity of demand of underage drinking

Kean University Professor Henry Saffer and Wharton School of Business Professor Dave Dhaval estimated that if the alcohol industry increased the prices of alcoholic beverages by 100 percent underage drinking would fall by 28 percent and underage b..

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