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Microeconomics

Economic costs & diminishing returns

Give a brief summary of economic costs. In the short-run, why might a firm still operate even when there is a loss. Explain the law of diminishing returns in your own words. This idea can be applied to almost anything in economics. Think about your own utility from consumption. Give a personal example of diminishing utility.

Cost functions are demonstrated

A firm has the cost function C = (3Wk + 5Wl) (q^2 + q) (a) Check that linear homogeneity in input prices is satisfied. (b) Suppose Wk = 2 and Wl = 1 . Compute, and roughly graph, the firmâ??s average and marginal cost functions. (c) What is the standard relationship between the marginal cost function and the aver

Effect of Price Changes on Quantity Demanded

Using table (below), determine by how much the demand for Florida Indian River oranges would change as a result of a 10 percent increase in the price of Florida interior oranges, and vice versa. Table Type of Orange Fl Indian River Florida Interior California FL Indian River -3.07

Mapco Enterprises

The economic analysis division of Mapco Enterprises estimated the demand function for its line of weed trimmers as Qd = 18,000 + 0.4N - 350Pm + 90Ps where N= number of new homes completed in the primary market area Pm = price of Mapco trimmer Ps = price of its competitor's Surefire trimmer In 2006

Calculating Unit Cost Growth Rate

Nicholas Nickelby, a quality control supervisor for Vinyl Windows, Inc., is concerned about an increase in distribution costs per unit from $10 to $13.80 over the last four years. Nickelby feels that setting up a new direct-sales distribution network at a cost of $17.50 per unit may soon be desirable. A. Calculate the unit co

Help needed

Suppose a business experiences a sudden increase in its fixed costs. For example, suppose property taxes increase dramatically. What impact, if any, will this have the firm's AFC (average fixed cost), AVC (average variable cost), ATC (average total cost) and MC (marginal cost) and therefore these cost curves? Why?

Actual Present Value for Lumpsum Option

If you did win $12 million in the New York lotto and you will be paid over a 20-year period- $600,000 a year- or you can get a lump sum payment up front. What is the actual present value of this $12 million? Interest rate is 5%.

Profit Estimation of Tax

Consider yourself a regulatory tax expert faced with the task of proposing a uniform standad of profit estimation. Given two options: Economic profit estimation and Accounting Profit Estimation. Which one would you establish as the standard for calculating profits? Why?

Pork barrel spending

Which of the following statements is the BEST example of pork-barrel spending? Congress recently passed a bill calling for an increase in taxes for all middle-income families. The Baldwin County Municipal Government recently raised $120,000 in tax revenue for use in the local high schools. When congress recently pas

Calculating Annual Worth

Calculate the annual worth (years 1 through 7) of the Merchant Trucking Company's cash flow with an interest rate of 10% per year. Year 0 1 2 3 4 5 6 7 -------------------------------------------------------------------------------------------------------

Immigration

The availability of jobs at higher real wages motivate people to migrate to the U.S. other things being equal, what impact will a large influx of immigrants have on real wages? What impact will it have on real wages in the immigrant's home country?

MBA Managerial Economics - Maximum Profit and Optimal Pricing

You are the manager of a firm that produces products X and Y at zero cost. You know that different types of consumers value your two products differently, but you are unable to identify these consumers individually at the time of the sale. In particular, you know there are three types of consumers (1,000 of each type) with the f

Own-price elasticity of demand

Suppose Qd = 10,000-2Px+3Py-4.5M, where Px = $100, Py = $50, and M = $2,000. What is the own-price elasticity of demand? A. -2.34 B. -0.78 C. -0.21 D. -1.21

Price at profit max, TR and TC at profit max

Assume a monopolist with the following: a. Qd = 100 â?" 10p b. TC = 1 + 2Q Find the following: 1.Price at profit max 2.Quantity at profit max 3.TR at profit max 4.TC at profit max 5.Profit Please answer in Word and provide appropriate graphs if applicable. Please create the graphs in Word

Corporations Current Examples

Please give some current examples, about 4, of the advantages corporations possess, giving them an advantage over other forms of business entities. Showing they have risen to dominate in the form of business organization. Please fully support your position in at least 150-175 of your own words. Thank you.

Maximize profits

Refer to the attached Table: Assume that these firms want to maximize profits. If the government wishes to cut discharge by 50%, it could do so by establishing an effluent fee of: . $3.00 $4.50 $5.50 $10.00

Market Structure

The pizza market is divided as follows: Pizza hut 20.7% Domino's 17.0 Little Caesar's 6.7 Pizza Inn 2.2 Round Table 2.0 All others 51.4 a. How would you describe its market structure? b. What is the approximate Herfindahl index? c. What is the four-firm concentration ratio

Dicussion question.

Should the club cover explicit and implicit costs? Imagine that you are asked to consult with a drama club that puts on a play every year. The club asks you: How much should we charge for tickets if we want to cover our costs? You begin by listing the club's explicit costs and implicit costs and then make a recommendation whethe

Total revenues for quantity sold

The teenager company makes and sell skateboards at an average price of $ 70 eacch. during the past year they sold 4000 of these skateboards. the company believes that the price elasticity for this product is about -2.5. if it decreases the price to $ 63 what should be the quantity sold? will revenue increase? why?

Certainty equivalent coefficient

An individual is indifferent between a certain payment of $20 and a game that will pay $50 or nothing with equal probabilities. The individual has a certainty equivalent coefficient of what? 0.20 0.40 0.80 2.50

Prisoner's Dilemma

Please see problem attached. Please determine if firms A and B in the scenario below face the prisoners' dilemma, and explain why they do or don't face this dilemma. ________________________________________________________________________ Firm B Low High ____________________________________

Walt Disney's Californian locale

When Walt Disney built Disneyland in Anaheim, California; he failed to realize the impact on the neighboring properties. When Walt Disney World in Orlando, Florida, was conceived, Disney did not want a repeat of Anaheim. Disney secretly began purchasing property in the Orlando area. Disney formed hundreds of fake companies to

Microeconomics

Suppose a monopolist sells its good to three people. Each person can only purchase one good. The first person is willing to pay $20 for the good, the second person is willing to pay $18, and the third is willing to pay $16. If these three people make up the entire market for this monopolist, the monopolist would face the demand

Profit Maximization

Fill in the table and tell me where a competitive firm faced with this cost structure would maximize profit, if price is equal to $50. Q....TC...MC...TVC...TFC...AVC...AFC 0....100 2....180 4....210 6....260 8....350 10...480

A risk-averse manager

A risk-averse manager is considering a project that will cost $100. There is a 10 percent chance the project will generate revenues of $100, an 80 percent chance it will yield revenues of $50, and a 10 percent chance it will yield revenues of $500. Should the manager adopt the project? Explain