Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
The Acme Bakery in the seaside resort town of Malvino sells freshly baked bread to two categories of consumers: residents of the town and tourists. The weekly demand from tourists is given by the demand function:
QT =600-120P
for prices P between $0 and $5. (There is no demand at prices above $5 per loaf.) The weekly demand from local residents is:
QI =540-180P
for prices P between $0 and $3. (There is no demand from locals at prices above $3 per loaf.) The bakery's marginal cost is constant at $1.20 per loaf.
1. Suppose the Acme Bakery could somehow set different prices for locals and for tourists. a) What prices would it set for each group? b) What contribution margin would it earn from the two groups?
2. a) If Acme had to charge the same price to both locals and tourists, what price would it set? Explain and show. b) What would be the associated contribution margin?Explain
3. The Acme Bakery has come to the Malvino Town Council with a request for a zoning variance that will permit it to sell bread at a new outlet located in the residential district of town. This will permit it to sell bread at the optimal price for tourists at its store on Main Street and sell bread at the optimal price for locals in this new outlet. The geography of the town is such that no tourist could buy bread at the store intended for locals (assume they would be unable to find it, and locals will not tell them about it). Also assume thatno local would buy from the Main Street location unless the price is lower than that charged at the new outlet. Acme's argument in favor of the requested variance is that it would promote the profits of local industry. As a member of the Town Council, you are concerned about the profits of the bakery - it makes generous contributions to your reelection campaign - but you also need votes, and so you are very concerned with the welfare of local customers. Should you favor this zoning variance? Explain and justify.
what are the relevance of economics to most business today??
a) Explain the conditions under which a monopolist is able to price discriminate. b) Demonstrate the relationship between a firm's marginal revenue function and its relationship
a 12 page project
Government Budget Deficits Governments have been traditionally spending more what they could earn by way of taxes and sale of economic goods and services produced by them. The
to what extent are interest rates determined by the economic theory
identify any four other law of demand and give examples
The sales of a company are the part of the total sales of industry. If the conditions of industry changes then the sales of each of the firm in the industry is affected. All teh ti
2. Suppose the price of printing paper for digital cameras has recently risen by 10 percent due to an increase in the cost of materials used in the finish for the paper. As a resu
what are the pros and cons of monopsony
what is production possibility curve?
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!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd