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Explain why a monopolist can increase profits by practising price discrimination compared with using a single price to maximize profits? What are the different kinds of price discrimination? What are the necessary conditions required for a monopolist to be able to practice each kind? Provide one example of each of the different types of price discrimination. You may use graphs to illustrate.
Are the salaries received by professional sports athletes outrageously high? Should the CEO's of financial institutions receive more monetary compensations than entertainers, since their jobs contribute more to the development of the country? What ar..
Now that you have finished finance, you know there are things that we know matter and things that we think matter and things that we know very little about. Adopting NPV>0 projects is in the set of things that we know matter. We recognize that in com..
For the following situations determine how the offered changes to supply and demand will affect the market-clearing price and quantity of each good. Your possible answers are “increases”, “decreases”, and “uncertain/not enough information”.
In the mid 1980s female nurses became increasingly aware that a relatively large number of attractive job opportunities existed outside the medical service industry. In fact large number of colleges offered life and transfer credits for nurses so tha..
How much are you willing to invest today to receive $150 a year for seven years and an additional $1,200 at the end of the seventh year? Assume this investment is low risk, that is, no riskier than putting money in a bank earning 2%.
A worker in Rhode Island can produce 1 pound of corn in 15 minutes and 1 pound of shucked oysters in 10 minutes. A worker in South Carolina can produce 1 pound of corn in 20 minutes and 1 pound of shucked oysters in 60 minutes. Which state has a comp..
Your firm must decide whether or not to introduce a new product. If you do so, then your rival may clone it and start producing a product that is very similar to yours. The one-time cost of developing the product for you is $100 million, the one-ti..
Monetarists are often characterized as ‘noninterventionists’ while modern Keynesians are characterized as ‘interventionists’. Why do Monetarists argue against intervention? What are the afraid of? Why do modern Keynesians argue in favor of interventi..
The cost of energy for operation high lift pumps in a water distribution system was $1.4 million for the first three years. Beginning in year four, the cost increased by $30,000 each year for the next 12 years. The cost of the energy is at an interes..
A company manufactures smartphone microprocessors whose cost function is given by C=6X+9, where X is the number of microprocessor chips. The selling price per unit is P=30-3X and maximum output of the plant is 30,000 units per month. Determine the op..
Why do pork also lamb have comapritively high price elasticities of demand compared with the other foodstuffs in the table.
Indicate two public policies that would be appropriate for addressing this situation. Explain their impact on your graph.
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