I need help understanding and applying concepts of managerial economics. 1. The manager of American Box Company conducts a study and notes his 10 workers produce approximately 2,000 boxes per week. He assumes that if he can employ 20 workers, the number of boxes will increase to 4,000 per week, and if he can employ 30 worker
See attached file for full problem description. I also attached the relevant lecture slide.
What is the welfare loss for society due to a monopoly?
The local widget monopolist is retiring. He owns the only machine that produces widgets. He offers to sell the widget machine to you for $52,500. After you purchase the machine you can produce as many widgets as you want at no additional cost. You know that the long run demand for widgets is as follows: P = 600 - 2Q where
Please answer the questions below and give full explanations so I can follow and learn how to apply myelf. 1. You are the manager of a firm that sells its product in a competitive market at a price of $60. Your firm's cost function is C(Q) = 30 + 3Q2. a. What is the profit-maximizing output for your firm? b. W
(see chart in attached file) The figure above illustrates the market for antifreeze. Suppose the government decides to implement an $8 sales tax on every gallon of antifreeze sold. In the figure, how would I illustrate the effect that the tax has on the market for antifreeze? How do I find out and what is the equilibri
An industry is composed of Firm 1, which controls 70 percent of the market, Firm 2 with 15 percent of the market, and Firm 3 with 5 percent of the market. About 20 firms of approximately equal size divide the remaining 10 percent of the market. Calculate the Herfindahl-Hirschman Index before and after the merger of Firm 2 and Fi
Explain the difference between a monopoly and an oligopoly, the welfare effects of monopoly, cost advantages that create monopolies, government actions that create monopolies, and government actions that reduce market power. SBC and ATT are planning to merge. Is tthis an monopoly or oligopoly and what actions, if any, do yo
(See attached file for full problem description with diagrams) --- 1. Suppose the Chicago Cubs could rent out Wrigley Field (the field the players play on) to local youth leagues for $11,000 per month. The $11,000 per month reflects the ______ of capital. A) implicit cost B) explicit cost C) direct cost D) total cost
Assume Boeing Inc. (of the United States) and Airbus Industrie (of Europe) rival for monopoly profits in the Canadian aircraft market. Suppose the two firms face identical cost and demand conditions, as seen in attached file. 1. Referring to attached graph, assume that Boeing is the first to enter the Canadian market. Without
Several of you have mentioned that monoplies arise from economies of scale: a particularly interesting issue is the concept of Minimum Efficiency Scale (MES). Are monoplies necessarily bad? In what cases are monopolies necessarily evils that are preferable to wasteful competition? The AT&T situation until its 1984 break-up,
Please help with the following problem. Provide step by step calculations for each. The following information about a monopoly is given: Demand: Q = 40-2P(Q) Average cost: AC(Q) = Q Marginal Cost: MC(Q) = 2(Q) (a) Derive the marginal revenue equation (b) Find the quantity at which
The patented drug, Botox, is currently sold by Allergan, Inc. The current price for a vial of Botox, is $400, and the marginal cost to produce a vial is $25. a) Using the Lerner index, find the price elasticity of demand for Botox and interpret what this value means to total revenue if the price of Botox were increased one p
Offers answers for the following multi-choice questions. Internalizing an externality refers to making a. buyers and sellers take into account the external effects of their actions. b. certain that all market transaction benefits go to only buyers and sellers. c. certain government does not disrupt
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