Lesson - 1 Business Economics- Meaning‚ Nature‚ Scope and significance Introduction and meaning : (Author : Dr. M.S. Khanchi) Business Economics‚ also called Managerial Economics‚ is the application of economic theory and methodology to business. Business involves decision-making. Decision making means the process of selecting one out of two or more alternative courses of action. The question of choice arises because the basic resources such as capital‚ land‚ labour and management are limited and
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euphemism‚ calling it breakfast. Dudley and Stephens when to trail for murder with‚ Brooks as witness. They confessed and claimed they had killed out of necessity. Arguments: 1. Did the benefits of killing the cabin boy‚ taken as a whole (considering utility of the 3 men’s family)? And consequences to society – weakening the norm against murder‚ increasing people’s tendency to take the law into their own hands. 2. Killing and eating a defenseless cabin boy is wrong for reasons that go beyond the calculation
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Outside Equity 1. Overview a. Compare behavior of manager who owns 100% vs. less than 100% i. Wholly owned he makes operating decisions which maximize his utility 1. Pecuniary returns and non-pecuniary aspects ii. Manager will expend resources to the point where the marginal utility derived from a dollar’s expenditure equals the marginal utility of additional purchasing power iii. As percent ownership falls‚ increased monitoring costs 2. Simple Formal Analysis of the Sources of Agency Costs of
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consistent between all people. 2. Why is the utility theory applied to consumer choice theory silent about comparing people’s utility levels? The utility theory is silent because utility levels cannot be compared. The utility level of any person can be multiplied by any number without personal preferences changing; therefore‚ the utilities of different people cannot be compared. One person does not have a higher or lower level than someone else. Utility levels are only capable of measuring preferences
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il/~canetti/f09-materials/f09-scribe9.pdf 3. http://www.econ.ucla.edu/iobara/SPE201B.pdf 2) a. What is indirect utility function? 1. http://www.princeton.edu/~dixitak/Teaching/MicroHighCalculus/Notes&Slides/Lec04.pdf 2. http://www.econ.hku.hk/~wsuen/teaching/micro/dual.html b. Given a direct utility function‚ how will you derive the indirect utility function? 1. c. Explain Roy’s identity. Section B 3) Derive the elasticity of substitution for the Cobb-Douglas
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the managers achieve maximisation of their own utility as well as utility of the shareholders. The conflicting interests of owners and management coincide with the objective of balanced growth of the firm as it ensures fair return on owner’s capital and faith in managers who achieve this goal. Marris specifies two utility functions. The utility function" of managers (Um) includes variables like salaries‚ status power and job security. The utility function of owners (Uo) includes variables such
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Chapter 14 The Basic Tools of Finance 1. The field of finance studies how a. society manages its scarce resources. b. people make decisions regarding resource allocation over time and how to handle risk c. people decide whether or not to become risk averse. d. society can reduce aggregate risk. ANSWER: b. how people make decisions regarding resource allocation over time and how to handle risk TYPE: M DIFFICULTY: 1 SECTION: 14.0 2. If you put $300 in an account
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willing to exchange exactly 1 rock and roll record for 2 classical records. Melody has convex preferences. a. True b. False （A）4. Maximilian consumes two goods‚ x and y. His utility function is U(x‚ y) = max{x‚ y}. Therefore x and y are perfect substitutes for Max. a. True b. False （B）5. Max Gross has the utility function U(x‚ y) = max{x‚ y}. If the price of x is the same as the price of y‚ Max will buy equal amounts of x and y. a. True b. False 6. If a consumer doesn’t consume any
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Malaysia’s economic system on utility maximization No rationale of Malaysia’s economic system on utility maximization Unclear discussion on the rationale of Malaysia’s economic system on utility maximization Brief discussion on the rationale of Malaysia’s economic system on utility maximization Clear discussion on the rationale of Malaysia’s economic system on utility maximization Able to discuss in detail the rationale of Malaysia’s economic system on utility maximization 30 Rationale
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Poland - a developing market A Cadbury Schweppes case study Page 1: Poland a developing market Why did Cadbury Schweppes choose Poland as its point of entry into the Central and Eastern European confectionery markets? Because there was a number of significant developments taking place there. The Central and Eastern European countries can be divided into two groups: those which fell originally within the Soviet Union‚ and others.The key difference is that the countries within the latter group
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