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A manufacturer of microwaves has discovered that male shoppers have little value for microwaves and attribute almost no extra value to an auto-defrost feature. Female shoppers generally value microwaves more than men and attribute greater value to the auto-defrost feature. There is little additional cost to incorporating an auto-defrost feature. Since men and women cannot be charged different prices for the same product, the manufacturer is considering introducing two different models. The manufacturer has determined that men value a simple microwave at $70 and one with auto-defrost at $80 while women value a simple microwave at $80 and one with auto-defrost at $150. a. If there is an equal number of men and women, what pricing strategy will yield the greatest revenue? b. What if women comprise the bulk of microwave shoppers?
Assume the size of the expenditure multiplier is ?G = 2. What is the effect of an increase in government purchases by ?G = 200 on income and the interest rate? By how much will private investment be crowded out as a result of this increase in governm..
Compute both Burton Cummings's explicit costs every month also his implicit costs every month. Compute the opportunity cost of the resources utilized by Burton Cummings each month.
Suppose that your employer offered you $4,000 in cash instead of health insurance coverage. Health insurance is excluded from state income taxes and federal income taxes. How different would this calculation look for a worker who earned $500,000 and ..
Finds in a simple regression analysis which demand increases with an increase in advertising also falls as advertising expenditures are reduced.
Suppose there are 3 risk-neutral bidders that are interested in purchasing a Pablo Picasso painting at an auction. The bidders have valuations for the painting of $8 million, $10 million, and $15 million. The bidders do not know each other's valuatio..
If elasticities for a bottle of water are -0.8 and -1.2 in two different locations and marginal cost is the same, which location is likely to charge higher price for the bottle of water?
A decline in the expected return on corporate bonds due to a rise in relative riskiness causes
What amount will be required to purchase, on an engineer’s 40th birthday, an annuity to provide him with 30 equal semiannual payments of $1,000 each, the first to be received on his 50th birthday, if nominal interest is 4% compounded semiannually?
You complain that the current labor contract specifies a full hour for your lunch break and you still have over 15 minutes left.
Consider a farmer who can either plant or market/consume his crop. Whatever amount he plants becomes a crop twice the size the following year. For example, if he plants seed from 2 ears of corn, he gets 4 ears of corn at harvest. Assume he starts off..
Explain how each of the following will affect the average fixed cost, average variable cost, average total cost, and marginal cost curves faced by a steel manufacturer.
Which of the following terms describes a contract based on information that cannot be observed by courts or arbitrators?
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