Macroeconomics
13th Edition
ISBN: 9780134735696
Author: PARKIN, Michael
Publisher: Pearson,
expand_more
expand_more
format_list_bulleted
Question
Chapter 10, Problem 5SPA
To determine
The four-firm concentration ratio.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Multiple choice - microeconomics
39) A profit-maximizing firm in a competitive market produces small rubber balls. When the market price for small rubber balls falls below the minimum of its average total cost but still lies above the minimum of average variable cost, what happens to the firm?
A. It will experience losses, but it will continue to produce rubber balls.
B. It will be earning only accounting profits.
C. It will be earning both economic and accounting profits.
D. It will shut down.
38)
5. Iowa farmers can choose from five different manufacturers of farm implement equipment. Two of these manufacturers account for more than 80 percent of all the farm equipment sold in Iowa. These two manufacturers produce very similar equipment. Whenever one manufacturer has a sale, offers rebates, or offers special financing, the other manufacturer quickly follows with a similar program.
Competitive Situation:
Explanation:
PART A
PART B - You own a printing firm. Two of your senior managers provide 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?
Ensure that you define any key terms used in your discussion.
Chapter 10 Solutions
Macroeconomics
Ch. 10.1 - Prob. 1RQCh. 10.1 - Prob. 2RQCh. 10.1 - Prob. 3RQCh. 10.1 - Prob. 4RQCh. 10.1 - Prob. 5RQCh. 10.2 - Prob. 1RQCh. 10.2 - Prob. 2RQCh. 10.2 - Prob. 3RQCh. 10.2 - Prob. 4RQCh. 10.3 - Prob. 1RQ
Ch. 10.3 - Prob. 2RQCh. 10.3 - Prob. 3RQCh. 10.4 - Prob. 1RQCh. 10.4 - Prob. 2RQCh. 10.4 - Prob. 3RQCh. 10.4 - Prob. 4RQCh. 10.5 - Prob. 1RQCh. 10.5 - Prob. 2RQCh. 10.5 - Prob. 3RQCh. 10 - Prob. 1SPACh. 10 - Prob. 2SPACh. 10 - Prob. 3SPACh. 10 - Prob. 4SPACh. 10 - Prob. 5SPACh. 10 - Prob. 6SPACh. 10 - Prob. 7SPACh. 10 - Prob. 8APACh. 10 - Prob. 9APACh. 10 - Prob. 10APACh. 10 - Prob. 11APACh. 10 - Prob. 12APACh. 10 - Prob. 13APACh. 10 - Technological and Economic Efficiency Use the...Ch. 10 - Prob. 15APACh. 10 - Prob. 16APACh. 10 - Prob. 17APACh. 10 - Prob. 18APACh. 10 - Prob. 19APACh. 10 - Prob. 20APACh. 10 - Prob. 21APACh. 10 - Prob. 22APACh. 10 - Prob. 23APA
Knowledge Booster
Similar questions
- Everyday, a clothing design firm needs workers who sew. It could contract out these services to tailor shops or hire tailors and conduct the business of sewing in house. Compare the relative firm versus market costs for this problem for two firms: Firm 1 sells low-cost dresses, and firm 2 sells high cost, designer dresses. Which business is more likely to use the market and which is more likely to have tailors within the firm?arrow_forwardFOREIGN OBJECTS — AND INSECTS During 2017 inspections of the Mars Inc. canning facility in Columbus, Ohio, where Pedigree, Iams and Cesar pet foods are manufactured, along with other brands, Mars told inspectors it was hearing consumer complaints about foreign objects — including insects — in the pet food.But the company insisted it was working to fully implement corrective actions.Pest control records at the facility noted damaged cans covered in flies, and dozens of employees had complained about cockroaches in the area, especially at night. Different employees described seeing “multiple roaches,” an “invasion of roaches,” “roaches everywhere” and even “millions of roaches” — which we hope was an exaggeration.Inspectors from the U.S. Food and Drug Administration (FDA) themselves observed 2 live roaches. The FDA stressed the seriousness of the pest problem, and the company “promised correction.” Around 2015, we started hearing reports of so-called “wires” or plastic…arrow_forwardMicrolith is a small firm whose product is identical to that of the other firms in the industry. A quick check of its NAICS code group reveals that the 50-firm concentration ratio for the industry is 3%. What will be the effect of Labor costs rising across the industry? Write a short narrative explaining how the market will adjust in the long run. Draw a neat 2-panel diagram illustrating the answer to 1barrow_forward
- J 7 Though many MNCs espouse and follow rigid codes of social responsibility in their home countries they are often not as diligent with respect to ‘host’ or overseas countries. In 1984 the Bhopal disaster in Madhya Pradesh, India killed 3,787 and impacted a further 558,125 people. The corporation in question was Union Carbide, a majority USA owned company. Indian courts convicted the Chairman and other senior executives of “…causing death by negligence”. i) Why do you believe that Union Carbide had a less stringent policy in India with respect to negligence than they did in the USA? ii) What is the way to fix this situation? Explain whether it is legislation or cultural change from MNCs that is requiredarrow_forwardLet’s consider an economy where all firms are favouring remote work to favour physical distancing and avoid the spread of a virus. To achieve these goals all firms receive a subsidy to equip their workers with a laptop. Consider that the market for laptops is in perfect competition and initially at the equilibrium. Explain the impact of the pandemic on the supply, demand, equilibrium on market of computers. Give a graphical representationarrow_forwardThe online shopping market is perfectly competitive. Profit-maximizing firms in the market are selling goods bu are currently incurring economic losses. What does this tell us about the market price? Select one: a. Market price must be less than average total cost. b. Market price must be greater than the average variable cost. C. Market price must be equal to marginal cost. d. All of the above.arrow_forward
- 3 examples and case study of microeconomics affect businessarrow_forwardPART B - You own a printing firm. Two of your senior managers provide 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?arrow_forwardMicroeconomics 1. Burger King Senior Discount drinks 10% off (60+) plus discounts on coffee and soft drinks. This is an example of PRICE _________________________ 2. Walmart sold toys below cost. FAO Scharwtz, a rival toy store could not match the prices and went out of business. Wal mart was using _____________________________ Pricing.arrow_forward
- Raymond decides to set up a lemonade stand every weekend for the next four weeks to save up for the latest x-men comic. He has to pay his brother Robert $10 as a one-time payment for him to not bully Raymond or drive his customers away. The lemons and sugar cost him $10 (the water is free) and his dad offers to set up his stall for him. He ends up making $15 his first weekend. Frank, his father notices this and advises Raymond to shut down the stall since he is making less than he is spending on the stall. What would you advise Raymond to do. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.arrow_forwardAssignment Content Suppose a firm uses sugar in a product that you purchase. The firm vertically integrates by purchasing sugar farms that produce the sugar organically and in a way that makes it also sustainable for the environment. How would that influence your demand for that product? What other purpose than profitability might cause the firm to make this decision to vertically integrate in this way? Your journal entry must be at least 200 words in length. No references or citations are necessary.arrow_forwardQuestion 2 A snowboard company currently hires 10 skilled employees who are paid a weekly wage of $1,000.The cost of capital is $3,000 and it is fixed, which means that it does not vary with output.The company is currently producing 24 snowboards .The company's cost will be $13,500 if it produces an additional snowboard. A customer is willing to pay $550 for the 241st snowboard . i) Should the company produce and sell it? (Yes or No). Explain ii) What core principles should be considered in the snowboard company's decision making? Scarcity ,choice and opportunity cost Cost benefit analysis Incentive principle Diminishing returnsarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Principles of Economics (12th Edition)EconomicsISBN:9780134078779Author:Karl E. Case, Ray C. Fair, Sharon E. OsterPublisher:PEARSON
Engineering Economy (17th Edition)EconomicsISBN:9780134870069Author:William G. Sullivan, Elin M. Wicks, C. Patrick KoellingPublisher:PEARSON
Principles of Economics (MindTap Course List)EconomicsISBN:9781305585126Author:N. Gregory MankiwPublisher:Cengage Learning
Managerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-...EconomicsISBN:9781259290619Author:Michael Baye, Jeff PrincePublisher:McGraw-Hill Education
Principles of Economics (12th Edition)
Economics
ISBN:9780134078779
Author:Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:9780134870069
Author:William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:PEARSON
Principles of Economics (MindTap Course List)
Economics
ISBN:9781305585126
Author:N. Gregory Mankiw
Publisher:Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-...
Economics
ISBN:9781259290619
Author:Michael Baye, Jeff Prince
Publisher:McGraw-Hill Education