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A city has two newspapers. Demand for either paper depends on its own price and the price of its rival. Demand functions for paper A & B respectively, measured in tens of thousands of subscriptions are
21 - 2PA + PB and 21 + PA - 2PB
The marginal cost of printing and distributing an extra paper just equals the extra advertising revenue one gets from another reader, so each paper treats Marginal costs as zero. Each paper maximizes its revenue assuming that the other's price is independent of its own choice of price. If the paper enter a joint operating agreement where they set prices to maximize total revenue, by how much will newspaper prices rise?
Direct intervention The government can also intervene directly in the economy to see that its wishes are carried out. This can be achieved thorough: a. Price and i
Using the discounting principle calculate the present value of an annuity of five years at Rs. 500 payments made at the end of each of the next five years at 10% interest. stion..
write a note on marris growth maximising model?
Difference between corporate profit maximization and maximization of shareholder wealth? Ans) Sure, profit maximization relates to profits *only* while shareholder wealth also i
NATIONAL INCOME ACCOUNTING This refers to the measuring of the total flow of output (goods and services) and of the total flow of inputs (factors of production) that pass thro
explain the law of demand. briefly discuss the exception to the law of demand
structure of managerial economics
Joe is evaluating the marketing strategy at his restaurant and inn. Suppose that in response to a $2.00 off sales promotion for spaghetti dinners, Joe finds that nightly dinner sal
MONEY MARKETS The expression "money markets" is used to refer to the set of institutions and individuals who are engaged in the borrowing and lending of large sums of money
Measuring Point Elasticity on a Non-linear Demand Curve Let's now explain the method of measuring point elasticity on a non-linear demand curve. Assume we want to measure the
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