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A typical customer who buys from a firm has a demand given by P = 90 - 3 Q. The firm has a constant marginal cost MC = $18 and no fixed cost. It currently uses a uniform pricing strategy (i.e., it charges a single price for all the units it sells), but it is contemplating to switch to the following block pricing strategy: “Buy the first 7 units at a price of $75 per unit, and any subsequent unit at a price of $54 per unit.” Compared with uniform pricing, profits per customer under the above block pricing are
a) $285 greater under block pricing
b) $147 greater under block pricing
c) $105 greater under block pricing
d) lower under block pricing than under uniform pricing
Richard Dulski’s firm is about to bid on a new radar system. Although the product uses new technology, Dulski believes that a learning rate of 80% is appropriate. The first unit is expected to take 720 hours, and the contract is for 45 units. What is..
Consider the following sequential ZSG. First, nature chooses heads or tails, each with probability one-half. Player 1 then sees nature’s choice, and chooses heads or tails. Player 2 then sees player 1’s choice but not nature’s choice, and chooses hea..
The Future Flight Corporation manufactures a variety of frisbees selling for $2.98 each. Sales have averaged 10,000 units per month during the last year. Recently Future Flight's closest competitor, Soaring Free Company, cut its prices on similar fri..
q.think of another good that you have purchased recently or you could continue with the good you selected in tda i. be
If the cross-price elasticity between two goods is 1.5, the goods are ____________.
Compare and contrast the way Classical and Keynesian theory determine the Demand for Money and how it is related to the Money Supply
Explain how much profit will the perfectly competitive firms earn. Explain how much profit will the monopoly firm earn.
If supply at every price is reduced by five gallons, what will the new equilibrium price be.
q.a brewery is considering two potential production investmentsoption a costs an initial 2 million as well as will
You have a choice between two fully amortizing home loans: a $90,000, 13%, 25 year loan and an $80,000, 12%, 25 year loan. What if the lender charges 2 points on both loans and the loan is paid off at the end of the 5th year. What is the IBC?
Suppose the government imposed a price ceiling on a monopolist. Let denote the price ceiling, and suppose the monopolist incurs no costs in producing output. True or false: If the demand curve faced by the monopolist is elastic at the price, then the..
Elucidate how would an increase in airfares affect the number of highway fatalities in any one year
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