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Economics - Vertical Relations
A monopolist manufacturer sells to a monopolist retailer. Suppose the final consumer demand for the good at the retailer level is P = 200 – 4Q and the costs for the manufacturer of producing the good are represented by TC = 40Q + 10. The wholesale price is the only cost of the retailer. Calculate the profit of the retailer and of the manufacturer.
Dan Unowsky manages a production group in a PC repair shop. He has noticed that the speed of repair is based on each worker doing one task. However, if an employee is out sick, then the entire repair process slows down.
How influential ideas in the business environment shape the business-government-society relationship and measure the importance of law and government regulation as a force guiding business behavior.
Consider commodity space where x1 is food and x2 is everything else. Allow food to have the price p1, and allow everything else to have the price of dollars, so p2 = $1. Denote income as m. Write out your budget set using mathematical set notation.
Explain the “objective theory of jurisdiction.” How does it apply to an organization doing business within a foreign country?
Intellectual property laws are intended to promote innovation, but some economists, such as Milton Friedman, have argued that such laws are not desirable. In the United States, there is no intellectual property protection for food recipes or for fash..
Due to the increased globalization of financial markets, we can expect all of the following, except:
An increase in the number of fast-food restaurants
How many homes should be built in a new residential area. The firm has some monopoly power in its local market. Its demand is estimated to be Q = 10 - 1/6 P. What is the revenue-maximizing price and quantity? Explain. What is the profit-maximizing pr..
Which of these statements about production scale effects is false? Suppose the demand curve for a business firm is downward sloping. Which statement is true about elasticity (ED), marginal revenue (MR), and/or total revenue (TR)?
Assume that you were ready to buy a custom tailored dress (or men’s suit) and you are prepared to pay up to $200 for it. Also assume that the tailor is prepared to sell that item of clothing for as little as $100. Discuss how this scenario relates to..
What would be the expected value of a bond if the annual interest payment is $80.00, the bond matures in 4 years, the principal is $1,000, and the yield to maturity is 9%?
An investment will pay $50 at the end of each of the next 3 years, $250 at the end of Year 4, $400 at the end of Year 5, and $600 at the end of Year 6. If other investments of equal risk earn 4% annually, what is its present value? If other investmen..
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