Microsoft is the market leader in office software with its MSOffice. Its marginal cost of production c is 1 dollar per unit. Home users demand 40 million licenses and are willing to pay 50 dollars, whereas businesses demand 60 million licenses and are willing to pay 100 dollars. Microsoft also produces a home version of MSOffice at a marginal cost of c¹=2. Home users and businesses are willing to pay 60 and 40 dollars, respectively, for the home version. Which is the best pricing strategy for Microsoft? O Selling MSOffice Professional at 100 Selling MSOffice Home at 40 O Selling MSOffice Professional units at 100 and MSOffice Home units at 40 Selling MSOffice Professional at 80 dollars and MS Office Home at 40 dollars
Q: (d) Consider the following demand-supply model: P =15−Qd; P =3+Qs Use the equilibrium condition…
A: Since you have asked multiple questions, we will solve the first question for you. If you want any…
Q: A utility company is considering the following plans to provide a certain service required by…
A: Plan Q Investment required - P500,000 Estimated life - 18 years Salvage value - 20% Annual…
Q: Suppose you borrow $5,000 at 7.25% interest for 14 months. What is the maturity value?
A: Simple interest is one of the easiest method to compute the amount to be received at the end of…
Q: 9. Demand for corn is known to be inelastic. If seed gene modification enhances the crop yield per…
A: Demand is said to be inelastic if the absolute value of degree of elasticity is less than 1. When…
Q: 8. Fredo loves watching Downtown Abbey on his local public TV station, but he never sends any money…
A: Here, it is given that an individual Fredo loves to watch Downtown Abbey on local public TV station,…
Q: 1/3 рошор 76²-19-95 =d tomor 8 + 6% =√ Ljuos
A: Demand function: Demand function shows the maximum price the consumers are willing to pay to…
Q: Mr Phiri has K10,000 in his account. He is considering investing in a project which has 70 %…
A: Given that; Income = K10,000 Probability of earning a profit= 70% Probability of incurring a loss=…
Q: 4. Suppose the market price in a perfectly competitive market is $100. If a firm has a total cost…
A: Optimal output level of a firms in perfect competition is achieved at the point where price is equal…
Q: . what are the strengths and weaknesses of the Caribbean stock exchange?
A: Companies and investors interact on a stock exchange. By offering equity shares for investors to…
Q: The country of Namibia imposes an 38% allowance for extraction of uranium. B3Gold Namibia company…
A: The country of Namibia imposes an 38% allowance for the extraction of uranium. B3 Gold Namibia…
Q: 2. The consumer has Leontief preferences for two goods and y: u(x, y) = min{2r, 5y}. pz > 0, Py> 0…
A: Expenditure minimization problem: For the given prices and utility level the consumer tries to…
Q: the equipment cost 500000 and has a salvage value of 25000 after its 20 years of useful life. using…
A: The double Declining Balance Method is one of the accelerated methods used for the calculation of…
Q: 1.6 Read the following extract and answer questions 1.6 - 1.9. "The European Central Bank is…
A: Inflation is a situation in which the price level of the goods and services produced in the economy…
Q: 1. Consider a pure exchange economy with two goods, 1 and 2, and two consumers, A and B, who have…
A: Pareto optimal allocation refers to those allocations deviating from which no one can be made better…
Q: Today’s rate for the USD/MXN is 21.72. Mexico’s 1-year interest rate is 6.0%. US 1-year interest…
A: The spot rate refers to current value of an asset in a market available for immediate delivery at…
Q: Question 5 The government increases its purchases of goods and services. As a result, in the…
A: Equilibrium in the economy occurs at the intersection of aggregate demand (AD) and aggregate supply…
Q: Consider the following simultaneous game: Player 1 U D Player 2 L 20,-10 -10, 20 R -10, 20 20,-10…
A: We have simultaneous move game between two players. Where player 1 has actions U and D. And player 2…
Q: Explain the three possible short-run profit maximising positions of a perfectly competitive firm.
A: Introduction Perfectly competitive refers to a market situation where there are very large numbers…
Q: Study the table below and answer the question that follows. Afghanistan US Carpets 100 500 Fighter…
A: Opportunity cost is the cost of producing one good in terms of other. Opportunity cost is used to…
Q: A. Determine whether it is socially optimal for Taylor to rehearse in the dorm. B. If UP policy…
A: The singing rehearsals in the dorm of student C save student T from paying Php 500 per hour on…
Q: You get a 7.5% 60-day $3,000 loan. The lender uses a 365-day year and charges you a $300 set-up fee…
A: Simple interest refers to approach applied to determine the proportion of interest paid on a sum…
Q: Your family owns a small sandwich shop called Healthy Hearty Sandwich that mainly caters to local…
A: The economic downturn results in lack of effective demand in the market from the consumers. As a…
Q: Considering your analysis, can you state with certainty that Q2 is greater than, same as, or less…
A: The relationship between the quantity of a good or service that producers want to sell at different…
Q: If the quantity of money grows at 7 percent a year, the velocity of circulation is constant, and…
A: The quantity theory of money is a study of the link between money, output, and pricing. It is…
Q: If Aggregate Demand is at AD2, production will be high as possible. Can production stay at this…
A: A given economy's aggregate demand is the total amount of products and services bought over a…
Q: The economy of Bananaland can be characterized by Equation 9.3. EQUATION 9.3:…
A: Aggregate demand includes consumption spending, investment spending and Government spending. So, AD…
Q: b) The inverse demand facing a farm sector is denoted by p= 20-x where x is output, and p is output…
A: The marginal cost, or price of producing more, is the variation in total cost that results from…
Q: 1.10 Read the following extract and answer questions 1.10 and 1.11. "South Africa has banned Bain &…
A: Failure of the open market to effectively distribute goods and services is what we mean when we talk…
Q: so what are the revenue implications of the two policies?(minimum unit price and a tax on alcohol)
A: Revenue implications are one kind of revenue which is imposed by the government and this type of…
Q: Henleigh Hill, CFO of HH Corp., uses a decentralized company processing center for check collection.…
A: Total annual cost will be including the fixed cost as well as the variable cost
Q: Question 6 P3 MC ATC P3 Xu f P2 P1 Quantity P2 Price P1 Price Q2 Q3 QW QXQX QZ more firms in the…
A: The given graph is of perfect competitive market. In the long run there is no fixed cost cost so…
Q: In building a plant, the Santos Novelty Corporation had the choice between three alternatives: One…
A: To determine the better of two alternatives proposed based on the cost. The given alternatives can…
Q: Outline the three monetary policy instruments the fed can implement if its objective is to cool off…
A: Federal reserve has two responsibilities: Achieving full employment and stabilizing price rise. The…
Q: sing the dynamic AD-AS analysis, show the effect of contractionary monetary policy.
A: Controlling an economy's money supply and the routes via which new money is provided is known as…
Q: In 2007, the city of Canfield collected $500,000 in taxes and spent $450,000. In 2007, the city of…
A: Budget deficit means the spending of government is more than the revenue generated. Budget surplus…
Q: You are meeting with your manager this afternoon. In preparation, she has asked you to calculate the…
A: A retail year's cumulative markup is the average markup at any given point in time (such as a month,…
Q: What are some recommendations to make the fair trade commission better.
A: The WTO implements regulations and agreements across economies to practice multilateral trade. The…
Q: the position of equilibrium output in relation to potential output.
A:
Q: Using your knowledge on time series, explain the following concepts: (a) Stationary and…
A: Time Series is define as the sequence of given observations taken at specific time intervals. Time…
Q: How will each of the following scenarios impact the market for money The central bank increases the…
A: The interest rate that commercial banks and other financial institutions pay to borrow short-term…
Q: By using Michael Porter’s five forces model, evaluate any industry of your choice.please provide…
A: According to the Micheal Porter's five for es model there are five significant forces that determine…
Q: 0.7 0.3 The Cobb-Douglas production function for a particular product is N(x,y)=40x y where x is the…
A: Given: Cobb-Douglas production function: N(x,y)=40x0.7y0.3 ......(1) Here x is the number…
Q: 2.1. Given a typical demand and supply schedule in the foreign exchange market, answer the following…
A: Demand refers to the quantity that a consumer wishes to buy at a given price in a given period of…
Q: In terms of price elasticity of demand, differentiate between perfectly inelastic demand and…
A: Price elasticity of demand is measure the percentage change in the quantity demanded due to…
Q: A manufacturing company is considering the purchase of a new machining center for $300,000 to expand…
A: Net present value worth will be computed as difference between the present value of cash inflows and…
Q: For each set of conditions given, use the aggregate supply – aggregate demand model to indicate what…
A: Aggregate demand represents the total demand in the economy for the finished goods and services that…
Q: 1. Consider a pure exchange economy with two goods, 1 and 2, and two consumers, A and B, who have…
A: Pareto optimal allocation refers to those allocations deviating from which no one can be made better…
Q: When you have diminishing marginal returns to labor A. variable costs fall as more output is…
A: Labor is the physical, mental, and social effort used for producing goods and services in the…
Q: Members of society lost jobs when COVID started. Businesses were closed, Goods and Services became…
A: Taxation, public spending, and public borrowing are all examples of instruments that fall within the…
Q: An organization serves 1,000 customers. Its average and marginal cost is $300 per unit and the price…
A: In the given question, initially the customers were 1000, which later been increase to 1200, since…
Step by step
Solved in 3 steps
- For many decades, the Royal Mail had a legal monopoly in the U.K. Companies in thepostal business have increasing returns to scale, then constant returns to scale, andthen decreasing returns to scale. The Royal Mail’s minimum average cost is £2 at 100million deliveries and its minimum marginal cost is £1 at 75 million deliveries.The demand for postage is zero at a price of £10, and demand is 300 milliondeliveries at a price of £0. Marginal revenue is zero at a price of £10 and 150 at aprice of £0.Note: Unless otherwise stated, the numerical answers in this question do not need tobe exact but should correspond to how you have drawn your graph. (a) Draw a large graph showing the Royal Mail’s average cost curve and itsmarginal cost curve. Show how many deliveries would be made, and at whatprice, if Royal Mail operated as a monopoly. Show the Royal Mail’s profit orloss on the graph. (b) The government makes a law restricting the price of postage to £1. Show theeffect of this policy in the…For many decades, the Royal Mail had a legal monopoly in the U.K. Companies in thepostal business have increasing returns to scale, then constant returns to scale, andthen decreasing returns to scale. The Royal Mail’s minimum average cost is £2 at 100million deliveries and its minimum marginal cost is £1 at 75 million deliveries.The demand for postage is zero at a price of £10, and demand is 300 milliondeliveries at a price of £0. Marginal revenue is zero at a price of £10 and 150 at aprice of £0.Note: Unless otherwise stated, the numerical answers in this question do not need tobe exact but should correspond to how you have drawn your graph. New technology changes delivery firms’ technology. Now, the minimumaverage cost is £2 at 1 million deliveries and a minimum marginal cost of £1at 0.75 million deliveries. The government removes all price restrictions andallows free entry. Describe the long-term outcome for this market, using twographs, one at the firm-level and one at the…For many decades, the Royal Mail had a legal monopoly in the U.K. Companies in thepostal business have increasing returns to scale, then constant returns to scale, andthen decreasing returns to scale. The Royal Mail’s minimum average cost is £2 at 100million deliveries and its minimum marginal cost is £1 at 75 million deliveries.The demand for postage is zero at a price of £10, and demand is 300 milliondeliveries at a price of £0. Marginal revenue is zero at a price of £10 and 150 at aprice of £0.Note: Unless otherwise stated, the numerical answers in this question do not need tobe exact but should correspond to how you have drawn your graph. The government makes a law restricting the price of postage to £1. Show theeffect of this policy in the short-run in a new, large graph. The graph shouldshow the firm’s average cost, marginal cost, marginal revenue, and consumerdemand. How much postage is bought? Show on your graph if the Royal Mailis in profit or loss, and by how much.
- |1.6.1 A company manufactures and sells x dellphones per week. The weekly price-demand and cost equations are given below. p= 400 - 0.5x and C(x) = 20,000 + 140x (A) What price should the company charge for the phones, and how many phones should be produced to maximize the weekly revenue? What is the maximum weekly revenue? The company should produce (Round to the nearest cent as needed.) phones each week at a price of $ The maximum weekly revenue is $ (Round to the nearest cent as needed.) (B) What price should the company charge for the phones, and how many phones should be produced to maximize the weekly profit? What is the maximum weekly profit? The company should produce (Round to the nearest cent as needed.) phones each week at a price of $ The maximum weekly profit is $ (Round to the nearest cent as needed.)A startup software company has indicated its cost, c(x), and revenue, f(x), as given below, such that x is the number of lines of programing code (units in 1000 lines). c(x) = 80000 - 2(x-200)2 f(x) = (x-10)3 + (x+10)2 Find the marginal cost analytically, and draw its graph Find the marginal revenue analytically, and draw its graph Solve for the x point where marginal cost is equal to marginal revenue analytically. Comment why is this point significant analytically. Write the profit function and draw its graph Is the profit function concave up or concave down?Round off your final answer to whole #. A company produces and sells a consumer product and is able to control the demand by varying the selling price. The approximate relationship between price and demand is 2700 5,000 p=47 + -forD>1 D D² The company is seeking to maximize its profit. The fixed cost is $1,000 and the variable cost is $39 per unit. What is the number of units that should be produced and sold each month to maximize profit?
- A major software developer has estimated the demand for its new personal finance software package to be Q=1,000,000P-2 while the total cost of the package is C = 10,000+ 25Q. If this firm wishes to maximize profit, what percentage markup should it place on this product where percentage markup is defined as 100*(sale price - marginal cost)/marginal cost? 4. a. b. C. d. e. ANS: 90% 100% 20% 40% 250%Suppose that the fish processor could use a different production method that involves recycling water. This would reduce the pollution in the lake to levels safe for recreation, and the water park would no longer be affected. If the fish processor uses the recycling method, then the fish processor's economic profit is $1,100 per week, and the water park's economic profit is $2,600 per week. If the fish processor does not use the recycling method, then the fish processor's economic profit is $1,800 per week, and the water park's economic profit is $1,500 per week. These figures are summarized in the following table. Complete the following table by computing the total profit (the fish processor's economic profit and the water park's economic profit combined) with and without recycling. Profit Fish Processor Action (Dollars) Water Park (Dollars) Total (Dollars) No Recycling Recycling 1,800 1,500 1,100 2,600 Total economic profit is highest when the recycling production method is $1,500…Suppose that the fish processor could use a different production method that involves recycling water. This would reduce the pollution in the lake to levels safe for recreation, and the water park would no longer be affected. If the fish processor uses the recycling method, then the fish processor's economic profit is $1,000 per week, and the water park's economic profit is $2,600 per week. If the fish processor does not use the recycling method, then the fish processor's economic profit is $1,700 per week, and the water park's economic profit is $1,500 per week. These figures are summarized in the following table. Complete the following table by computing the total profit (the fish processor's economic profit and the water park's economic profit combined) with and without recycling. Action Profit Fish Processor Water Park Total (Dollars) (Dollars) (Dollars) No Recycling 1,700 1,500 Recycling 1,000 2,600 Total economic profit is…
- A company produces very unusual CD's for which the variable cost is $ 15 per CD and the fixed costs are $ 50000. They will sell the CD's for $ 79 each. Let a be the number of CD's produced. Write the total cost C as a function of the number of CD's produced. C =$ Write the total revenue R as a function of the number of CD's produced. R=$ Write the total profit P as a function of the number of CD's produced. P=$ Find the number of CD's which must be produced to break even. The number of CD's which must be produced to break even is Question Help: Video Submit QuestionHi! Can you help me with the question below? Northside Social (NS) sells cups of coffee and amazing breakfast sandwiches. The current price of a cup of coffee is $3.00 and the current price of an amazing breakfast sandwich is $8.00. At those prices, NS sells 1000 cups of coffee and 200 breakfast sandwiches daily. NS faces a constant marginal cost for each cup of coffee of 50 cents and the constant marginal cost of breakfast sandwiches is $2. NS increases the price of coffee 5%, to $3.15. After the price increase, NS sells 900 cups of coffee, a decrease of 10% in cups of coffee. Demand for coffee at NS at this price interval is best described as:A) ElasticB) InelasticC) Unitary ElasticD) Perfectly ElasticPakPerfect Inc. estimates equation of its total costs of production as TC = 500 + 10Q + 5Q2 and market demand for its product as Qd = 105 – (1/2) P, where Q is quantity in units and P is price in Pak$. Write the equations of the firm’s costs, as a function of Q: Average Total Cost ATC Average Variable Cost AVC Average Fixed Cost AFC Given above costs can you determine what will be the firm’s production in Stage 1? What is the breakeven price and breakeven quantity for this firm? What is the shutdown price and quantity for this firm? Draw the firm’s costs in a graph as per your determination in (a). Label the breakeven and shutdown price and quantity using information in (b) and (c) above. Given the market price of Pak$ 50 how many units should the firm produce? how many firms are competing in this market in short-run? How many firms will be in the industry in the long-run? How do you interpret the profit or loss condition of PakPerfect? Use a two-panel graph of the Market and…