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You are about to sign a contract with a book publisher. Under the terms of the contract the publisher has sole authority to set the price. The only issue is what percentage of the gross receipts you get. Is it always the case that you would want as high a percentage as possible? To make things concrete suppose the demand for the book as a function of its price p is 100-p. The unit cost of production and distribution of the book is $10. Suppose the author gets fraction α of the revenue generated.
1. Compute the publisher's pro?t maximizing price as a function of α.
2. Vary α between 0 and 1 and plot the author's gain.
Suppose the EU now institutes a cap and trade system. Each permit is good for one ton of carbon abatement. The total cap is 120 tons. Each of the two plant types receives an equal amount of permits. What is the market price for permits?
If you are available for work and have looked for a job at some point during the previous twelve months, but have not actively looked during the previous four weeks, you are considered. Suppose that you are available for work but have not looked for ..
Determine the percentage change in price required to increase the quantity demanded of public transportation by 12%.
You are Chair of the Federal Reserve Board. In your meeting with the Federal Open Market Committee, the committee unanimously votes to increase the money supply using open market operations (OMOs). During the press conference after the meeting a repo..
Medfin Accounting Company (MAC) specializes in providing accounting and tax services for medical establishment and professionals. Presently, the company's production method is highly labor-intensive because many of the books keeping tasks are done ma..
You are given the following information about the economy of Nocoin: The banks have submitted of $300 billion, two thirds of which is in deposits with the central bank.
Assume that you have $10,000 in deposit and you are asked to make investment in the financial market i.e. bond market and/or stock market. Where will you invest and why? Illustrate the advantages and disadvantages of investing in each type in terms o..
Would integration between the following types of firms constitute a horizontal, a vertical, or a conglomerate merger?
Illustrate what varibles other than price appear to have the biggest impact on the demand for mcdonald's products. how much influence does the company have over these varibles.
Calculate the consumers surplus at the indicated unit price (a) for the the demand equation.
In a single year, the Netherlands can raise 100 tons of beef or produce 1,000 boxes of tulips. In the same growing season, Belgium can raise 50 tons of beef or produce 750 boxes of tulips.
Suppose that a Starbuck’s venti latte currently sells for US$4.00 in the United States and C$5.00 in Canada. Make up a value for the exchange rate between the U.S. dollar and the Canadian dollar (expressed as Canadian dollars per U.S. dollar) that le..
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