2. Complete the table below. Total Revenue Quantity Marginal Revenue Total Cost Marginal Cost Price Profit 3,000 2,600 2,200 1,800 1,400 100 80 20 60 40 40 60 20 80 100 a. Calculate the profit-maximizing output, price, and profit. b. Will other firms enter this market and compete with this firm?
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- Andrea’s Day Spa began to offer a relaxingaromatherapy treatment. The firm asks you how muchto charge to maximize profits. The first two columnsin Table 10.5 provide the price and quantity for thedemand curve for treatments. The third column showsits total costs. For each level of output, calculate totalrevenue, marginal revenue, average cost, and marginalcost. What is the profit-maximizing level of output forthe treatments and how much will the firm earn inprofits?Shakti Inc. has been granted a patent for its arnica toothache balm. The table to the right shows the demand and the total cost schedule for the firm. What is Shakti's profit minus maximizingoutput? A. 4 units B. 6 units C. 7 units D. 5 units Price per dose (Dollars) Quantity Demanded (Dose) Total Cost of Production (Dollars) $80 0 $80 72 1 82 64 2 88 56 3 100 48 4 124 40 5 164 32 6 208 24 7 268 16 8 340Please give a brief explanation. Thankyou. Define cause marketing in the context of a nonprofit organization’s earned income strategy. What are advantages and disadvantages of this earned income strategy? Please provide example too.
- ADJ Enterprises produces hydrothermocorticoids. The table below shows the costs of producing various quantities of hydrothermocorticoids. Quantity Total Cost Average Cost 0 $0 -- 1 $10 $10.00 2 $12 $6.00 3 $15 $5.00 4 $19 $4.75 5 $24 $4.80 6 $30 $5.00 7 $45 $6.43 ADJ sells its hydrothermocorticoids for $5 each (that is the price regardless of the number of hydrothermocorticoids it sells). Use the Profit-Maximizing Rule to explain the quantity that ADJ should produce to maximize its profits. You may use a calculator. You should explain the details of any calculation you perform. You should identify, explain, and apply the concept you use to answer this question. To receive full credit, your explanation must show all steps in any calculations you perform. Your explanation must also incorporate the profit-maximizing rule – state what that rule is and explain how it applies to ADJ’s situation. Note that it is…A local hospital offered to buy firm A for $5,000, and the offer was refused. However, many observers now perceive that firm A is “in play” and may be sold if the right offer comes along. a. In successful transactions, purchasers have typically paid ten times current profits. How much would firm A be worth to a buyer from outside the industry? b. Would you expect that firm B would be willing to pay more or less than an outside buyer? c. What is the most firm B would be willing to pay for firm A?There are only two driveway paving companies in a small town, Asphalt, Inc. and Blacktop Bros. The inverse demand curve for the services is ? = 2040 − 20?where quantity is measured in pave jobs per month and price, in dollars per job. The firms have an identical marginal cost of $200 per driveway. If the two firms collude, splitting the work and profits evenly, how many driveways will each firm pave, and at what price? How much profit will each firm make? Does Asphalt have an incentive to cheat by paving one more driveway each month? Show it numerically.
- Andrea’s Day Spa began to offer a relaxing aromatherapy treatment. The firm asks you how much to charge to maximize profits. The first two columns in the table below provide the price and quantity for the demand curve for treatments. The fifth column shows its total costs. Complete the table. What is the profit-maximizing level of output for the treatments and how much will the firm earn in profits? Price Quantity Total Revenue Marginal Revenue Total Cost Marginal Cost $25 0 $0 N/A $130 N/A $24 10 $275 $23 20 $435 $22.50 30 $610 $22 40 $800 $21.60 50 $1005 $21.20 60 $1225A publisher faces the following demand schedule for the next novel from one of its popular authors:Price Quantity Demanded100 090 100,00080 200,00070 300,00060 400,00050 500,00040 600,000 530 700,00020 800,00010 900,0000 1,000,000The author is paid $2 million to write the book, and the marginal cost of publishing the book is a constant $30 per book.d. In your graph, shade in the deadweight loss. Explain in words what this means. e. If the author was paid $3 million instead of $2 million to write the book, how would this affectthe publisher’s decision regarding the price to charge? Explain. f. Suppose the publisher was not profit-maximizing but was concerned with maximizing economicefficiency. What price would it charge for the book? How much profit would it make at thisprice? (On average, the price of a patented pharmaceutical drops between 30 and 50 percent after the patent expires. Explain why this occurs. (Do not use AI).
- Exercise 5.8 The makers of Panadol pain reliever do a lot of advertising and have very loyal customers. In contrast, the makers of generic paracetamol do no advertising, and their customers shop only for the lowest price. Assume that the marginal costs of Panadol and generic paracetamol are the same and constant. a. Draw a diagram showing Panadol’s demand, marginal revenue and marginal cost curves. Label Panadol’s price and mark-up over marginal cost. b. Repeat part (a) for a producer of generic paracetamol. How do the diagrams differ? c. Which company has the bigger mark-up? Explain. d. Which company has the bigger incentive for careful quality control? Why? e. How might barriers to entry influence the behaviour of the makers of Panadol ? f. What factors would affect the extent to which the makers of Panadol could engage in predatory or destroyer pricing to force out competitors in this market?The global pandemic 2020 has promoted a race to capture the market for introducing effective vaccine and treatments. (please use excel/word) a)- If PFIZER is the sole vaccine provider given the following information, answer the questions below: Output Price/Unit Total Cost 1 5500 1000 2 5000 1200 3 4500 1500 4 4000 2500 5 3500 4000 6 3000 5700 7 2500 7500 8 2000 9400 9 1500 11400 10 1000 13500 Given the tabular information above find the profit-maximizing output and price also illustrate the same using the two-dimensional labeled diagram. Show the calculation as well. (use excel) b)- Assume if many firms enter into the business of providing vaccine determine: How the demand curve of PFIZER would change and how it would now maximize its profit? The kind of market structure now PFIZER is forced to operate in? Also,…Suppose that the market for e-readers is an oligopoly controlled by Amazon.com , Barnes and Noble,Sony, and Apple. Barnes and Noble is consideringincreasing its output. How would this affect themarket price? How would it affect the profits ofeach company?
