rket research has also shown that the demand curve for train tickets is downward sloping. You may assume that your company is not a price taker on the market. b)One of your colleagues has suggested that it is important to lower the price of train tickets. In that case, she argues, the demand will increase. Do you agree with her? Explain why. c) She continues her argument by concluding that if t

rket research has also shown that the demand curve for train tickets is downward sloping. You may assume that your company is not a price taker on the market. b)One of your colleagues has suggested that it is important to lower the price of train tickets. In that case, she argues, the demand will increase. Do you agree with her? Explain why. c) She continues her argument by concluding that if t

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter12: The Partial Equilibrium Competitive Model

Section: Chapter Questions

Problem 12.14P

See similar textbooks

Similar questions

You are the manager of a train company. Recently total sales have been a bit low and you are now considering means to give sales a boost. Market research has shown that currently the price of train tickets is historically low. Market research has also shown that the demand curve for train tickets is downward sloping. You may assume that your company is not a price taker on the market. i) One of your colleagues has suggested that it is important to lower the price of train tickets. In that case, she argues, the demand will increase. Do you agree with her? Explain why. ii) She continues her argument by concluding that if the demand goes up, the total value of sales of train tickets should therefore increase. Do you agree with her? Explain why.
You are the manager of a train company. Recently total sales have been a bit low and you are now considering means to give sales a boost. Market research has shown that currently the price of train tickets is historically low. Market research has also shown that the demand curve for train tickets is downward sloping. You may assume that your company is not a price taker on the market. 1.One of your colleagues has suggested that it is important to lower the price of train tickets. In that case, she argues, the demand will increase. Do you agree with her? Explain why. 2.She continues her argument by concluding that if the demand goes up, the total value of sales of train tickets should therefore increase. Do you agree with her? Explain why.
You are the manager of a train company. Recently total sales have been a bit low and you are now considering means to give sales a boost. Market research has shown that currently the price of train tickets is historically low. Market research has also shown that the demand curve for train tickets is downward sloping. You may assume that your company is not a price taker on the market. a) One of your colleagues has suggested that it is important to lower the price of train tickets. In that case, she argues, the demand will increase. Do you agree with her? Explain why. b) She continues her argument by concluding that if the demand goes up, the total value of sales of train tickets should therefore increase. Do you agree with her? Explain why.
Question: As the manager of Smith Construction, you need to make a decision on the number of homes to build in a new residential area where you are the only builder. Unfortunately, you must build the homes before you learn how strong demand is for homes in this large neighborhood. There is a 60 percent chance of low demand and a 40 percent chance of high demand. The corresponding (inverse) demand functions for these two scenarios are P = 300,000 − 400Q and P = 500,000 − 275Q, respectively. Your cost function is C(Q) = 140,000 + 240,000Q. How many new homes should you build, and what profits can you expect?
You are the manager of a firm and you are required to optimize the Cobb-Douglas function given the following parameters. The maximum amount of money available to spend is $340 where the price of K=8 and the price of L=4. That is Pk=8 and Pl=4. The function is given as q=K0.4L0.6 . What is the constraint equation?
As the manager of Smith Construction, you need to make a decision on the number of homes to build in a new residential area where you are the only builder. Unfortunately, you must build the homes before you learn how strong demand is for homes in this large neighborhood. There is a 80 percent chance of low demand and a 20 percent chance of high demand. The corresponding (inverse) demand functions for these two scenarios are P = 300,000 −300Q and P = 800,000 −200Q, respectively. Your cost function is C(Q) = 180,000 + 260,000Q. How many new homes should you build, and what profits can you expect? Give typing answer with explanation and conclusion
As the manager of Smith Construction, you need to make a decision on the number of homes to build in a new residential area where you are the only builder. Unfortunately, you must build the homes before you learn how strong demand is for homes in this large neighborhood. There is a 60 percent chance of low demand and a 40 percent chance of high demand. The corresponding (inverse) demand functions for these two scenarios are P = 300,000 – 400Q and P = 500,000 – 275Q, respectively. Your cost function is C(Q) = 140,000 + 240,000Q. How many new homes should you build, and what profits can you expect? Number of homes you should build: homes Profits you can expect: $
Describe any three managerial decisions that can be applied by the manager from the estimated demand function
You own a printing firm. Two of your senior managers provided you with advice. The first manager states that your company is losing money for every unit that is printed. To minimize losses, she advises that you reduce your production levels. The second manager states that if your firm sells some more units, the price will cover your increase in costs. In order to reduce losses, the second manager recommends that you should increase production. Explain which manager is correct and who is offering the correct advice
Diego and Thuy had the same negative experience at a restaurant (slow service and cold food). Diego is willing to try the restaurant again because he went during peak hours when the restaurant was packed, understaffed, and had less control over outcomes. Thuy on the other hand, will not give the restaurant another chance because she went to the restaurant when it was almost empty and found the slow service to be inexcusable. The following theory best explains the difference in dissatisfaction and future post-purchase behavior exhibited by these two customers: Group of answer choices Asymmetric Effect Theory Equity Theory Expectancy Disconfirmation Theory Attribution Theory Contrast Effect Theory
In many cases, it is reasonable to refer to the ________________ as the price Group of answer choices budget constraint sunk cost opportunity cost marginal utility
Ahmed is an agent for Bader for maintaining Bader’s antique cars collection, including sale and purchase of antique cars. Ahmed has had this position for several years, but recently Ahmedhas developed a cocaine habit. He recently sold one of Bader’s cars and kept some of the money himself to buy some cocaine. Soon thereafter, Ahmed was declared bankrupt. The government then notified Ahmed that he had sold the maximum allowable number of cars in a year without getting a dealer’s license. Shortly thereafter, Bader was on a secluded island and died, which no one knew about until 2 weeks later. Discuss the effect of these events on the existence of the agency.