SOLUTION Explicit cost computation Items | GH¢ | Cost of products and services sold | 710‚000 | Selling expenses | 310‚000 | Administrative expenses | 90‚000 | Interest expense (bank loan) 90
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Pure Competition ANSWERS TO END-OF-CHAPTER QUESTIONS 21-1 Briefly state the basic characteristics of pure competition‚ pure monopoly‚ monopolistic competition‚ and oligopoly. Under which of these market classifications does each of the following most accurately fit? (a) a supermarket in your hometown; (b) the steel industry; (c) a Kansas wheat farm; (d) the commercial bank in which you or your family has an account; (e) the automobile industry. In each case justify your classification. Pure competition:
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Chapter 15 – Mankiw SOLUTIONS TO TEXT PROBLEMS: Quick Quizzes 1. A market might have a monopoly because: (1) a key resource is owned by a single firm; (2) the government gives a single firm the exclusive right to produce some good; or (3) the costs of production make a single producer more efficient than a large number of producers. Examples of monopolies include: (1) the water producer in a small town‚ who owns a key resource‚ the one well in town; (2) a pharmaceutical company that is given a patent
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1. *Define scarcity and opportunity cost. What role these two concepts play in the making of business decisions? Scarcity is a Ever-present situation in all markets whereby either less goods are available than the demand for them‚ or only too little money is available to their potential buyers for making the purchase. This universal phenomenon leads to the definition of economics as the "science of allocation of scarce resources." Opportunity cost is the cost of an alternative that must
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"Turbulent Air in Those Azure Clouds" Case Study 1. In your own words‚ summarize Microsoft’s problem. The market is starting to focus on cloud computing which is a big problem for Microsoft because the idea of cloud computing would render some of their most successful services as outdated or obsolete. In turn‚ they are have to create software to compete in this cloud computing era‚ and by doing so‚ they are taking business away from their own services. 2. Explain the meaning of the following:
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ABSTRACT Corporations continue to use a variety of measures to gauge their financial performance for many years. Economic value added (EVA) has been introduced as a very effective performance measurement and strategic assessment tool. One of the reasons why EVA is such a powerful instrument is that it is linked to market value added (MVA)‚ which is the definite indicator of a company’s wealth creation. Another reason for using EVA is that it is the only dependable and precise continuous improvement
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Question 1 (a) Price (P‚$’000) Quantity (minutes) Total Revenue (TR‚$’000) Marginal Revenue (MR‚$’000) Total Cost (TC‚$’000) Marginal Cost (MC‚$’000) Average Cost (ATC‚$’000 per minutes) 90 100 9000 --- 5000 --- 50 80 120 9600 30 5500 25 45.83 70 140 9800 10 5700 10 40.71 60 160 9600 -10 6000 15 37.5 50 180 9000 -30 6400 20 35.56 (b) The market structure of television broadcasting industry is oligopoly. As the television broadcasting industry requires
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Principles of Miroeconomics - Final Exam Instructions Please put your name and the course information on the scantron (ECON 2302 Professor J. Bikis) Please put your DBU ID number on the scantron in the area market "ID NUMBER" Please write your webadvisonr id on the back of the scantron in the area marked "WEBADVISOR ID". (This ID is the same ID that you use to get into your DBU email or into BlackBoard) Please select the best answer for each question given and fill in the respective answer
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Chapter 4: Consumer surplus: the difference between market price and what consumers (as individuals or the market) would be willing to pay. It is equal to the area above market price and below the demand curve · the difference between the maximum amount the buyer was willing to pay and the actual price paid Producer surplus: the difference between market price and the price at which firms are willing to supply the product. It is equal to the area below market price and above the supply curve
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BAUMOL’S MODEL OF SALES REVENUE MAXIMISATION Maximising sales revenue is an alternative to profit maximisation and occurs when the marginal revenue‚ MR‚ from selling an extra unit is zero. Revenue maximisation graph (ref: The condition for revenue maximisation is‚ therefore‚ to produce up to the point where MR = 0 SALES MAXIMISATION Sales maximisation is another possible goal and occurs when the firm sells as much as possible without making a loss. Not-for-profit organisations
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