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An aircraft with 100 seats serves passengers through two types of fares: full ($550) and discount ($250). Extra passengers have $50 marginal cost. Demand for discount tickets is unlimited, while demand for full-fare tickets is evenly distributed between 11 and 30 seats. How many seats should be protected for full-fare passengers and not authorized for release to the discounted $250 segment?
Did the managers involved satisfice or optimize? What was their risk approach to the decision they made? In your assessment, how creative was their decision?
Write a summary (500-750 words) to discuss your data findings and the proposed solutions generated based on applying econometrics and analyzing the data.
Use the midpoint formula to compute the price elasticity of supply for copper. (Related to Application 4 on page 529.)
The Zenvox Television Company faces a demand function for its products that can be expressed as Q = 4,000 - P + 0.5I, where Q is the number of televisions, P is the price per television and I is the average monthly income. Average monthly income i..
Characterize the equilibrium path of this economy, and show that as α → 1, the equilibrium path approaches that of the baseline AK economy. Interpret this result.
Show that Q2 and U span the same subspace, where Q2 is the sub-matrix of Q with the first column removed. Under what circumstances will they be the same, up to sign flips?
Explain how this problem could be solved intuitively by assuming this person consumes only one good-a ham-and-cheese sandwich.
Could the auto store qualify as a holder in due course?
Why is the optimal value of γ not equal to some γ∗ ≥ 1/(1- β)? Provide an interpretation in terms of the trade-off between level and growth effects.
Assume that you have been hired as a managing consultant by a company to offer some advice that will help it make a decision as to whether it should shut down completely or continue its operations. It currently uses 100 workers to produce 6,000 un..
A city engineer knows that she will need 25 million in 3 years to replace toll booths on a toll road in the city. Traffic on the road is estimated to be 20 million vehicles per year. How much per vehicle should the toll be to cover the cost of the..
What is the profit-maximizing quantity of output? On one diagram, sketch the total revenue and total cost curves. On another diagram, sketch the marginal revenue and marginal cost curves.
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