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Q. Example on Changes in fixed costs and profit maximisation?
What if arena owner in the illustration above triples the fee for the subsequent concert but all other factors are the same. What price must the promoter now charge for tickets in light of the fee increase?
The same price of Rs. 10
Fee is a fixed cost, which promoter should consider a sunk cost and simply ignore it in calculating his profit maximising price. Only effect is that promoter's profit will be reduced by Rs. 20, 000.
Suppose that the present level of income in the economy is $700 billion. It is determined that in order to decrease the unemployment rate to the desired level, it will be essential
A firm's technology needsit to combine 5 person-hours of labor with 3 machine-hours to make 1 unit of output. The firm has 15 machines in place and the wage rate rises from $10 per
Given a saving function of S = -25 + .2Yd, a $10 billion enhance in government spending will bring about how many dollars of change in consumption?
tce
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income generation process through investment multiplier
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