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Your firm sells a perfume. The daily demands for your perfume are different between men and women, groups that are identifiable to you. Their daily demands are as follows. Men: P=40-5Q Women: P=60-5Q Your marginal cost is constant at $2 per bottle of perfume. (a) Write the marginal revenue for each of the markets. (b) To maximize profit, what price would you charge per bottle for men and women, respectively? Show work. (c) What quantities do you sell to men and women, respectively? (d) A certain activist group opposes your practice of gender-based price-discrimination and is taking you to court. Explain how you would determine the maximum amount you are willing to spend to fight the case, assuming that you will win if you fight (you can continue to charge 2 prices if you win)?
Why does the assumption of independence of risks matter in the examples of insurance.
Illustrate what is the short-run market supply curve. Find out the short-run equilibrium cost and quantity in this industry.
terrorist attacks on the World Trade Center and the Pentagon affected short and/or long-term productivity in the United States. Explain your response and show any movements in the PPF.
llustrate what happens to the money supply. Elucidate how would this change the incentive structure facing depository institutions.
The licorice industry is competitive. Each firm produes 2 million strings of licorice every year. Total cost of strings have an average.
Find the cost functions for the following firms: A firm with production function f(x1,x2) = min{ 2xl,3x2} A firm with production function f(xl,x2) = 2x1 +3x2 A firm with production function f(x1,x2) = In
Can Alpha make a credible threat to punish Beta with a retaliatory price cut
Suppose the government increases G to 1250. Compute private saving, public saving, and national saving and the new equilibrium interest rate.
find out that the exchange rate for your U.S. dollar has decreased relative to the euro. If you were a U.S. citizen or resident, are you pleased.
If government industry regulators underestimate the degree of competition in an industry are they likely to over-regulate the industry? Explain.
If you were the angel investor, what is your certainty equivalent for these two projects? Are you risk-averse, risk-neutral, or risk-lover?
Why is the money multiplier considered to be a potential multiplier rather than an indication of exactly how much multiplication should be expected?
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