monopolist’s profit maximizing price and output if it charges a single price? Answer: MR = 520 – 4Q MC = 100 + 2Q 520 – 4Q = 100 + 2Q Q = 70 units of output P = 520 – 2Q = 520 – 2(70) = $380 per unit of output b. Given the above information‚ calculate this single price monopolist’s profit. Answer: Profit = TR – TC TR = P*Q = ($380 per unit)(70 units) = $26‚600 TC = 100Q + Q2 + 50 = 100(70) + (70)(70) + 50 = $11‚950 Profit = $14650 c. At the profit maximizing quantity‚ what is this
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P2.6 Price and Total Revenue. The Portland Sea Dogs‚ the AA affiliate of the Boston Red Sox major league baseball team‚ have enjoyed a surge in popularity. During a recent home stand‚ suppose the club offered $5 off the $12 regular price of reserved seats‚ and sales spurted from 3‚200 to 5‚200 tickets per game. A. Derive the function that describes the price/output relation with price expressed as a function of quantity (tickets sold). Also express tickets sold as a function of price
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purchased a new printing machine that will allow it to publish new types of promotional material for advertising agencies. The following are the relevant revenue and cost relations: P = $90 - $0.0075Q TC = $132‚000 + $7.5Q + $0.00075Q2 a. Fill in the blanks in the following table: Quantity (Q) Price (P) Total Revenue (TR) Marginal Revenue (MR) Total Cost (TC) Marginal Cost (MC) Total Profit (π) Marginal Profit (Mπ) 0 1‚000 2‚000 3‚000
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Monopolistic competition (b) Perfect competition (c) Monopoly (d) Oligopoly Q2 Perfect competitive firms maximize: (a) Total profits by producing where price exceeds average total cost by the greatest amount (b) Per unit profits by producing where marginal revenue equals marginal cost (c) Total profits by producing where price equals marginal cost (why not MC=MR?) d) Market share by producing where price equals average total cost Q3 Which idea is inconsistent with perfect competition? (a) Short-run losses
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when the profit maximizing assumption is maintained‚ the notion of profits has been broadened to take into account uncertainty faced by the firm (in realizing profits) and the time value of money. In this more complete model‚ the goal of maximizing short-term profits is replaced by goal of maximizing long-term profits‚ the present value of expected profits‚ of the business firm. The expected profit in any one period can itself be considered as the difference between the total revenue and the total
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* Small business finance * Corporation finance * Multinational business finance Goals of Business Finance * Maximizing profit - realizing the highest possible peso or dollar. * Maximizing profitability - when a firm decides on obtaining a higher rate of return on its investment. * Maximizing profit subject to cash constraint * Maximizing net present worth - to maximize the current value of the company to its owners. *Time value of money
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NY: Farrar‚ Straus and Giroux. Gerber‚ S. (2012). How Entrepreneurship Can Fix Young America [Entire issue]. Time . Retrieved from http://business.time.com/2012/03/05/how-entrepreneurship-can-fix-young-america/#ixzz1oLhzORQM Green‚ D. (2007). Springfield‚ Massachusetts [Case Study]. Retrieved from Federal Reserve Bank of Boston:
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Q1) Explain (using example) the law of diminishing marginal productivity (DMP). Also‚ explain the difference between the law of DMP and law of returns to scale............................................................. 3 Q2) Explain how profit maximizing output is determined in a .............................................................. 9 a) Perfect competitive market ............................................................................................................. 9 b)
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Maximizing Profits in Market Structures Student Name XECO/212 Month Day‚ Year Instructor Name The three important market structures in economics are competitive markets‚ monopolies‚ and oligopolies. Each market plays a different role in the economy. Competitive markets are when no firm has the power to affect the market price of a good and “many buyers and sellers trading identical products so that each buyer and seller is a price taker”
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| | | 3‚050 units | | | 1‚875 units | 0.1 points Question 7 1. Answer the following questions using the information below: Kaiser ’s Kraft Korner sells a single product. 7‚000 units were sold resulting in $70‚000 of sales revenue‚ $28‚000 of variable costs‚ and $12‚000 of fixed costs. Breakeven point in units is: Answer | | 2‚000 units | | | 3‚000 units | | | 5‚000 units | | | None of these answers are correct. | 0.1 points Question 8 1
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