is offered a pay raise but will need to relocate in order to accept it this is a compromising decision that is not easy to resolve. I will be explaining the principles of individual decision making‚ provide an example and compare and explain the marginal benefits and cost associated with the decision. I will also explain the decision that led me to make a different decision. Principles of Decision Making As individuals we are faced with making decisions that we sometimes have to compromise in
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the control variable are net benefits maximized? 108 b. What is the relation between marginal benefit and marginal cost at this level of the control variable? At this control level‚ the marginal cost is smaller than the marginal benefit. There is still a marginal net benefit of 10. Control variable Q Total Benefits B(Q) Total Cost C(Q) Net Benefits N(Q) Marginal Benefit MB(Q) Marginal Cost MC(Q) Marginal Net Benefits MNB(Q) 100 1200 950 250 210 40 170 101 1400 1000 400 200 50 150 102 1590
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c Question 3 0 out of 4 points If a firm is selling a product in two markets‚ A and B‚ and the marginal revenue in A is $25 and the marginal revenue in B is $20‚ the firm should Selected Answer: a. charge a higher price in A where MR is higher Question 4 4 out of 4 points The ability of a monopoly to charge a price that exceeds marginal cost depends on Selected Answer: the price elasticity of demand. Question 5 4 out of
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The Nature and Scope of Managerial Economics Managerial Economics • Managerial economics‚ meaning the application of economic methods in the managerial decisionmaking process‚ and it is a fundamental part of any business. This is happening for several reasons It is becoming more important for managers to make good decisions and to justify them‚ as their accountability either to management or to shareholders increases. Number and size of multinationals increases‚ the costs and benefits
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Cost Concepts for Managerial Decision Making Prepared for instructional use in Economics For Managers ECG 507 College of Management North Carolina State Universiy © Stephen E. Margolis 2000 Soon we will be using the concepts of cost that are presented in Landsburg’s chapters five and six to analyze market behavior of firms. With a bit of interpretation‚ however‚ these concepts have immediate application to ordinary decisions that
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for 20 minutes. These conditions were importance of change (marginal and central) and change type (color‚ location and disappearance and reappearance of images). These changes were presented in random order with two practice trials followed by 46 trials. The participants were exposed to all of the conditions making this experiment a within-subjects experiment. It was hypothesized that individuals would take a longer time to detected marginal changes than central change. Participants had to look at two
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Labor (students) Total Products (pineapples/per day) 0 0 1 100 2 220 3 300 4 360 5 400 6 420 7 430 1. Calculate the marginal product of the third student; 2. Calculate the average product of three students; 3. Over what numbers of students does marginal product increase? 4. When marginal product increases‚ compare average product and marginal product. Two: (10 points) Tulip growing is a perfectly competitive industry‚ and all tulip growers have the same cost curves
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industry‚ the entry and exit of the firms will ensure that the P = MC + min. ATC. However‚ for pure monopoly industry there is no entry and exit of firms as it is conquer by only one party. The marginal revenue (MR) curve lies below the demand and the produces output where MR = MC‚ so‚ the price exceeds the marginal costs (MC) and also exceeds the lowest average total cost (ATC). Pure Competition Pure Monopoly Price Price Quantity Quantity Pc D D Qc S = MC Pc MC Qc MR
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pap-smear exams for women. The new frequency recommendation was designed to address the family histories of the patients. The optimal frequency should be where the marginal benefit of an additional pap-test: Answer Selected Answer: equals the marginal cost of the test Correct Answer: equals the marginal cost of the test Question 4 3 out of 3 points Various executive compensation plans have been employed to motivate managers to make decisions
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switching to a variable-pricing strategy for tickets so that they can get a higher profit on games with record attendance numbers. They feel the need to do so because the marginal costs‚ such as construction payment and players’ salaries‚ did not equal to the marginal revenue‚ since attendance was severely dropping. To pay for the marginal cost‚ the sports team needed to capitalize on things that they were sure of‚ like increasing attendances to games between major sporting rivals. 2) What would happen
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