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Supply and Demand

"hardware-software" linkage

Problem I: European market for DVDs There are many markets in which a "hardware-software" linkage is important. This problem examines supply and demand forces for an emerging market, namely, digital video disks or DVDs. The DVDs are the software and DVD players are the associated hardware. The dynamic evolution of the DVD marke

NC generators

1. As part of the preparations for the arrival of a hurricane, NC residents sought to purchase electricity generators. As a result, you expect that in NC a. the price of generators will tend to rise b. the price of generators will tend to fall c. shortages will tend to be observed d. a and c e. b and c. 2. Recent stu

MacroEcon policy and graphs

1.Suppose a bank has $200,000 in deposits, a required reserve ratio of 10 percent, and bank reserves of $50,000. Then the bank can make new loans in the amount of? 1a. If the required reserve is decreased, how do you show that on a graph (investment demand)? 1b. If the required reserve is decreased, what happens to the eq

Profit Maximization

(See attached file for full problem description) --- Profit Maximization: Equations. Rochester Instruments, Inc., operates in the highly competitive electronics industry. Prices for its RII-X control switches are stable at $50 each. This means that P = MR = $50 in this market. Engineering estimates indicate that relevant

Monetary policy implementation and the Federal Reserve

1. What type of monetary policy has the Federal Reserve been using for the past year (easy/expansionary, tight/contractionary, or neutral/non-involvement)? 2. Why have they been using this policy? 3. How have they implemented the policy (changing the "interest rate", changing the reserve ratio, or open mark

Government Intervention for Socially Efficient Outcomes

These questions come from Baye's fifth edition of Managerial Economics and Business Strategy. Chapter 14: A Manager's Guide to Government in the Marketplace. 1) You are the manager in a market comprised of five firms, each of which has a 20 percent market share. In addition, each firm has a strong financial position and is

Marcroeconomics Question

The federal government wants to cool down the overheated economy by cutting its spending. Describe how this policy may affect the unemployment rate. Next, consider the follwoing three scenarios, and USE APPROPRIATE DIAGRAMS to show the likely effects of an activist policy in both the short and long run. A. The economy is ab

Banking Systems Reserve

Suppose the banking system's nonborrowed reserves total $48.3 billion, with total legal reserves standing at $51.2 billion. What must borrowed reserves be? This morning the Federal Reserve decided to undertake the sale of $500 million in government securities through open market operations. What will the new level of nonborro

Estimating Sales and importance to business

How does your business go about estimating its sales? (This is often a confidential procedure.) How does it estimate the demand for new products so that it can prepare a production run? Which is more important for your business: lower cost, quality, customer expectations, or some other feature? Why?

Use of interactive graphs to explain total revenue and monopoly behavior.

(1) In the first graph link below, move the green pointer on the horizontal axis to "3.0" and how many pizzas were gained and how many robots lost and why? (2) Explain the difference between "rational self-interest" and "greed"

Supply and demand

A few questions to clarify supply and demand: If the number of producers for a product declines- what happens to the supply and demand of that product? If you have two items that are complements in consumption and the price of one of them goes up, what happens to the demand of each of the items?

IS-LM model questions

1. Discuss the factor(s) that determine the slope of the LM curve and whether an increase in theses factor(s) will make the curve flatter or steeper. 2. In words what does the IS curve represent? 3. What factor(s) causes the LM curve to shift? 4. In words what does the LM curve represent? 5. Is the interest rate we

Economics and management

13. If an oligopolistic firm decides to raise its price. A. other firms will automatically follow B. none of the other firms will follow c. other firms may follow if it is the price leader D. only some of the firms will follow 14. The main difference between perfect competition and

Foundations of microeconomics and macroeconomics

Microeconomics is considered to be the study of scarce resources. Here, consumers (both individuals and organizations) must make allocation decisions. These three basic trade-offs include which goods/services are to be produced, how to produce them, and who gets them. Briefly explain the three trade-offs within a specific good/s

Problem Set

1. Explain why personalized pricing or first degree price discrimination is usually more profitable than menu price. Why, if this is the case, do companies use menu pricing? 2. Companies often sell multiple products (e.g., such as PepsiCo produces and sells both soft drinks and snack foods such as Fritos and Lays potato chip

Monetary Policy

Suppose that, as the chair of the Fed, you decide to "put policy on automatic pilot" and require that monetary policy follow an established rule. When might each of the following two rules be appropriate? (a) Maintain a constant interest rate. (b) Maintain a constant money supply.

Economics and Management

1. A new taco-making machine that is similar in size and cost to hog dog carts has encouraged more street vendors to begin selling tacos. What SHORT RUN impact do you think this might have on the market for hot dogs? A decrease in the demand for hot dogs B. increase in the demand for hot dogs C. d


The market for beet sugar is purely competitive and entry is free. There are 1000 producers in the industry each of which has a total cost function given by: TC= 240q - 20q² +q³ The demand: Q= 21,280 - 2P 1- determine the industry's supply curve and graph it. Suppose the normal production process for beet sugar u

Perfect Competition Free Market Economy

GRAPHIC ILLUSTRATIONS, ESSAYS AND CALCULATIONS 1. In a free market economy, the price mechanism works to allocate scarce resources in the most efficient manner. Illustrate and explain how this mechanism works to achieve market equilibrium between supply and demand forces. How does a change in supply/demand differ from a shi

2 Problems

10. How does a tariff affect consumer's surplus and producer's surplus? Explain and demonstrate with a graph. 13. What is dead weight loss? How does seller market power create dead weight loss? Explain and demonstrate.

Broomsticks are manufactured by 2 firms...

Broomsticks are manufactured by 2 firms which constitute a competitive industry. Neither firm has any fixed costs. There are two consumers, Jack and Enis. Consider the following information. Total Cost Total Value Quantity Firm


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TC Equation - Economics and Management

Please refer to attached word document for instructions. 1) A monopoly firm in a small island country produces and supplies to the country. It faces a market demand curve for its products. The demand equation is linear, so is the firm's total cost (TC) function. The following table exhibits the data for Quantity, Price,

Regulation and Consumer Surplus

If the consumer surplus is small, does it mean that the demand will be greater for regulation or the supply will be smaller for regulation?

Labor economic questions

Determine whether True or False a) A firms labor demand curve will be more elastic if product demand is more elastic. b) The earned income tax credit has been shown to increase labor force participation. c) monopsonists are defined by their ability to set prices in the product market. d) an increase in the demand for