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You are the manager of a theater. At present the theater charges the same admisssion price of $8 to all customers, regardless of age. You propose a two-tier pricing scheme: $5 for children under the age of 12 and $10 for adults. You tell your supervisor that your proposal is likely to increase revenues. What must be the price elasticity of demand if your proposal is to achieve its goal of raising revenue? Explain your answer.
You want to retire in 35 years. The Actuarial table indicates that your anticipated years in retirement will be 20 years. If you anticipate the return on your investments will be 5% and you wish to get $100,000 per year in retirement, how much money ..
Suppose the multiplier is 3, the marginal tax rate is 20%, and the marginal propensity to consume out of disposable income is 0.9. If government spending increases by $10 billion, then would national saving increase or decrease, and by how much?
Suppose that you are trying to decide whether to spend 4,000 on stock issued by WildWeb or on a bond issued by the same company.There is a 50 percent chance that the value of the stock will rise to? 8,800 at the end of the year and a 50 percent chanc..
Using the information on exhibit 2 calculate the consumer price index in the current year.
The Soup Nut serves his signature minestrone soup in two different bowl sizes, large and small. What strategy should he use to extract the most surplus possible out of customers who come in two types, regular and big eaters, when he cannot distinguis..
A medical device company has a monopoly on a certain class of cardiac implants. Demand for the implants is given by P=28000-5Q and marginal revenue is given by MR=28000-10Q. The total fixed costs for the implants division is 50000 and the marginal co..
Sales personnel for Skillings Distributors submit weekly reports listing the customer contacts made during the week. A sample of 65 weekly reports showed a sample mean of 18.5 customer contacts per week. The sample standard deviation was 5.8. Provide..
Can you describe how these participants contribute to the GDP [Gross Domestic Product] and to the economic growth? How can the economy bounce back quickly from the recession? As we begin fleshing out the Wheel of Income and the National Income Accoun..
From the e-Activity, assess how business leaders use managerial economics to make business decisions indicating how profits may be impacted.
You are given the following figures on economic base: primary employment: 10,000; Secondary employment 30,000 A) Determine the ration B) a New Factory engaged in primary employment is moving into the base and intends to employ 250 persons. What are t..
Illustrate what is the maximum price of capital at which the firm will still make nonnegative profits.
Why as a result of rise in exchange rate, the amount of imports fall but not as much as it does when the supply is perfectly elastic.
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