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In 2007, dairy farmers faced an (equilibrium) wholesale price for their milk of about 1 cent per ounce. Because of changes in consumer preferences, the demand for milk has been declining steadily since then.
a. In the short run, what effect would this have on the price of milk? On the number of dairy farmers (and the size of dairy herds)? Explain.
b. What long-term prediction would you make for the price of milk?
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Assume that instead of maximizing profit, the firm wants to maximize total revenue. Using algebra determine the optimal output, price, profit and revenue for the firm.
Method in which Herb could use a cost-benefit analysis to argue for or against an expansion
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An auto dealership estimates that its demand curve has an elasticity of 2.78. If it wishes to increase sales by 12%, by how much should it decrease price? What will happen to revenue (rise or fall)? If instead it raises price by 20%, what is the perc..
What advantages does General Electric seek to attain from its international business activities and what actions is it taking to gain these advantages from its international activities?
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