Running head: Four Principles of Individual Decision Making Four Principles of Individual Decision Making Name University of Phoenix Four Principles of Individual Decision Making The first principle of Economics is that people face trade-offs (Mankin‚ 2007). Making decisions requires trading off one goal against another. The first lesson about making decisions is that to get to one goal you must give something to get something‚ it is a trade. An example is that in order to go to work
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elasticity of the product and will also include the way the pricing will relate to elasticity of the product. Furthermore‚ the paper will include the way the changes in the quantity supplied as a result of the pricing decisions will affect marginal cost and marginal revenue. Moreover‚ the paper will focus on the non-pricing strategies‚ and will explain the way the changes in the business operations could alter the mix of fixed and variable costs in line with the strategy. Market Structure
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CHAPTER 9—PERFECT COMPETITION HOME WORK 1. Market structure is determined by the a. volume of discounts‚ the quantity of foreign exchange‚ and the effects of Federal Reserve policy b. influence of government policy‚ the number of qualified buyers‚ and the effect of generally accepted accounting principles c. number of buyers and sellers‚ whether the product is standardized‚ whether there is free entry and exit‚ and how well informed the buyers and sellers are about the market d.
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a) (enter‚ hard) and (not enter‚ hard) b) (enter‚ soft) and (not enter‚ soft) c) (not enter‚ hard) and (enter‚ soft) d) (enter‚ hard) and (not enter‚ soft) 2.Suppose P = 20 - 2Q is the market demand function for a local monopoly. The marginal cost is 2Q. If fixed costs are zero and the firm engages in two-part pricing‚ the most profits the firm will earn is: a) $5. b) $10. c) $25. d) $50. P=MC=2Q=20-2Q Q=5 P=MC=2*5=10 Fixed Tariff = (20-10)*5/2=25 3. play
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greatest profit. There are several approaches to this problem. The total revenue - total cost method relies on the fact that profit equals revenue minus cost‚ and the marginal revenue - marginal cost method is based on the fact that total profit in a perfectly competitive market reaches its maximum point where marginal revenue equals marginal cost. Basic definitions there are two different types of costs every business has and these costs are: ➢ Fixed cost ➢ Variable cost. Fixed
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market. 2. Explain and illustrate‚ what the likely short-run effect f the cyclone is on the cost curves of a bananas growing firm in the cyclone-affected region? In the short run‚ both average total cost (ATC) and marginal cost (MC) will increase. Based on the law of diminishing marginal returns‚ when products expand‚ the return of per unit product is decreasing. On the on the other hand both MC and ATC are increasing. The examples in this case are The nature of the problems which can arise from this
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of all non-labor resources are fixed.Refer to the above data. Diminishing marginal returns become evident with the addition of the:Answer Selected Answer: third worker. Correct Answer: third worker. Question 8 1 out of 1 points Answer the question on the basis of the following output data for a firm. Assume that the amounts of all non-labor resources are fixed.Refer to the above data. The marginal product of the sixth worker is:Answer Selected Answer: 15 units of output
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an economic activity is desirable and should be undertaken as long as the marginal benefits exceed the ____. 6). The closest example of a risk-free security is 7). The primary difference(s) between the standard deviation and the coefficient of variation as measures of risk are: 8). The ____ is the ratio of ____ to the ____. 9). If demand were inelastic‚ then we should immediately: 10). Producers’ goods are: 11). Marginal revenue (MR) is ____ when total revenue is maximized. 12). Suppose we estimate
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ECF2731 - Managerial Economics (Summer) Exam Information Coverage: The final exam includes all topics covered in lectures and tutorials (Hirshey Chapters: 1‚ 2‚ 3‚ 4‚ 7‚ 8‚ 10‚ 11‚ 12‚ 13‚ 14‚ and 16). The purpose is that the student demonstrates a good understanding of the key concepts and ideas in each chapter. To perform reasonably well in the exam‚ it will be sufficient to read the chapter references (Hirshey 2009) for each lecture‚ the lecture slides as well as the topics covered in the tutorials
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fully employed. 4. The resources are efficiently employed. 5. The resources are not equally efficient in production of all products. Thus if resources are transferred from production of one good to another‚ the cost increases. In other words marginal opportunity cost increases. The last assumption needs explanation because it determines the shape of the PP curve. If this assumption changes‚ the shape changes. Efficiency in production means productivity i.e. output per unit of an input. Let
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