Part (a) Consider a firm called Health-R-Us that is a monopoly. How does Health-R- Us decide the price to charge and quantity to sell of the good it has a monopoly on? Illustrate your answer using a fully labelled and explained market diagram. Assume Health-R-Us is making monopoly profits and illustrate these on the same diagram. In addition, indicate the area on your diagram that illustrates the efficiency cost (the dead weight loss) of the monopoly, and explain why this dead weight loss arises. Part (b) Assume Health-R-Us is a legal monopoly: it is a monopoly due to legal protection from the government in the form of a patent issued to the company. Imagine that the government withdraws the legal protection for Health-R-Us such that the market becomes competitive. Will a typical individual firm in this competitive market make economic profit in the long run? Why or why not? Use an appropriate firm-level diagram to illustrate and explain your answer. Part (c) Your answers to parts 2a and 2b illustrated different levels of profit made by an individual firm in both a monopoly market structure and a competitive market structure respectively. In part 2a you also indicated the dead weight loss of a monopoly. Assume now that Health-R-Us has discovered a vaccine for coronavirus. Why might the government be willing to grant (and allow to remain in place) a patent to Health- R-Us, despite the dead weight loss and the ensuring monopoly profits caused by such a patent? Explain your answer. For simplicity assume the vaccine is only relevant for the domestic market (i.e., there is no global market for vaccines). [5+5+5 = 15 marks]

Part (a) Consider a firm called Health-R-Us that is a monopoly. How does Health-R- Us decide the price to charge and quantity to sell of the good it has a monopoly on? Illustrate your answer using a fully labelled and explained market diagram. Assume Health-R-Us is making monopoly profits and illustrate these on the same diagram. In addition, indicate the area on your diagram that illustrates the efficiency cost (the dead weight loss) of the monopoly, and explain why this dead weight loss arises. Part (b) Assume Health-R-Us is a legal monopoly: it is a monopoly due to legal protection from the government in the form of a patent issued to the company. Imagine that the government withdraws the legal protection for Health-R-Us such that the market becomes competitive. Will a typical individual firm in this competitive market make economic profit in the long run? Why or why not? Use an appropriate firm-level diagram to illustrate and explain your answer. Part (c) Your answers to parts 2a and 2b illustrated different levels of profit made by an individual firm in both a monopoly market structure and a competitive market structure respectively. In part 2a you also indicated the dead weight loss of a monopoly. Assume now that Health-R-Us has discovered a vaccine for coronavirus. Why might the government be willing to grant (and allow to remain in place) a patent to Health- R-Us, despite the dead weight loss and the ensuring monopoly profits caused by such a patent? Explain your answer. For simplicity assume the vaccine is only relevant for the domestic market (i.e., there is no global market for vaccines). [5+5+5 = 15 marks]

Runiowa is a fashion shoe company that tries to manufacture much more durable heels in 2020. The management team of Runiowa suggests two rubber materials A and B and the research team of Runiowa is asked to design an experiment to gauge whether the rubber A is more durable than the rubber B. 300 people in the US aged between 18 and 65 were randomly chosen. The rubber A is allocated at random to the right shoe or the left shoe of each individual. Then, the rubber B has been assigned to the other. For example, if Mr. Nathaniel is one of 300 people randomly chosen, then the right heel of Mr. Nathaniel is randomly assigned to be made with the rubber A and then his left heel is to be made with the rubber B. The research team measures the amounts of heel wear both the rubber A (wA) and the rubber B (wB) in each individual and records the difference wA − wB of 300 individuals. Even though the individuals are heterogeneous with different heights and weights, those individual heterogeneities will not obscure the comparison of treatment groups by focusing on the paired differences of each individual. Also as long as the heel materials are randomly assigned for each individual, there has been no restrictions on shoe styles. Note that the age of subjects is ranging from 18 to 65. In this way, researchers compare treatments within blocks controlling heterogeneity of individuals. The research team also repeats this experiment design with 300 people in the US aged between 18 and 65 chosen at random.

Question:

What are the experimental units?

What is the control?

Hoe much replication was used?

How was randomization used?

Cheap-As-Dirt Rental Company advertises that the average cost of a rental they find for undergraduate students at the University of Oregon is $580 with a standard deviation of $75 (Let us assume the rents are approximately Normally distributed.) The Department of Consumer Protection will investigate the company if, when they choose a sample of students, they find that the average rental cost for those students is $610 or more. Assuming that the company is advertising truthfully, what is the probability that the company will be investigated if the Department of Consumer Protection samples 8 clients? (Round your answer to 4 decimal places, to the ten thousandths place.)vg

What errors or abuses may occur in each of the following scenarios and what control is needed on each case:

         1. Clara has responsibility for collecting cash & for recording the cash receipts in the accounting records.

         2. John prepares & signs all checks and then records them in the accounting records. When the monthly bank statement comes, he does the bank reconciliation.

         3. The XYZ company receives a monthly bank statement with canceled checks. It does not bother to reconcile the bank statement with its books.

         4. Each day the XZY company makes 70 journal entries. It does not take a total of all debit & credit entries.

         5. The XYZ company has an account with CITI limousine service to provide transportation for its employees in the daily conduct of their work. Each employee has a voucher book which he/she can use to provide the transportation needed.

         6. XYZ company keeps a petty cash fund with $300 to meet everyday business needs. The fund is kept in the supply cabinet & may be accessed by anyone who needs cash for firm expenses.

         7. XYZ company requires any individual who needs a check to be disbursed, to fill out & sign a check request form. When this is done the cash disbursement department cuts a check to the payee listed.

         8. The XYZ company holds bearer securities that are waiting instructions from its owners as to final location. The company keeps these securities in a file cabinet that has a $ 9.99 combination lock on it.

         9. The assistant to the controller calculates weekly the interest accrued & to be posted for each debt security. His /her calculations are used to send weekly updates to clients on their interest earned.

1. A university wants to estimate the proportion of its students who smoke regularly. Suppose that this university has N = 30, 000 students in total and a SRSWOR of size n will be taken from the population. a) If the university wants the proportion estimator ˆp to achieve the precision with tolerance level e = 0.03 and risk α = 0.1. Estimate the minimal sample size needed for this estimation. (z0.1 = 1.28, z0.05 = 1.65) b) Suppose that, in a pilot study, the university takes a SRSWOR of size 20 students, among which only 2 students are found to be smokers. Based on this preliminary result, re-compute the minimal sample size for part (a). c) Suppose the university chooses the sample size estimated from (b), and finds that the sample proportion is ˆp = 0.15. Construct a 90% confidence interval for the population proportion p

The following transactions were completed by the company. The company completed consulting work for a client and immediately collected $6,500 cash earned. The company completed commission work for a client and sent a bill for $5,000 to be received within 30 days. The company paid an assistant $1,900 cash as wages for the period. The company collected $2,500 cash as a partial payment for the amount owed by the client in transaction b. The company paid $900 cash for this period's cleaning services. Required: Enter the impact of each transaction on individual items of the accounting equation. (Enter decreases to account balances with a minus sign)

You’ve just won the lottery which promises to pay you $5,000 per month for the next 30 years, starting in one month. The lottery company is require to buy US Treasury securities to guarantee that it can meet its obligation to you. If Treasury securities earned 5% APR compounded monthly, how much would the lottery company have to invest today to cover its obligation?

The Swatch Group and Cultural Uniqueness

Summary

This case explores the Swatch Group and the influence of Swatch on culture. Founded in 1983 by Nicolas Hayek, Swatch is now the world’s biggest watch maker. The company not only produces finished watches, it also produces jewelry, watch movements, and watch components. Indeed, Swatch Group supplies nearly everything used in the production of its 18 individual brands that includes icons like Omega and Harry Winston as well as more mainstream options like Tissot and Longines.

In addition to its own line of products, Swatch Group sells watch components to third-party watchmakers and produces parts used for sport event timing. Swatch employs about 37,000 people across 37 global subsidiaries. With some 40 percent of the company still under the control of the Hayek family, Swatch focuses on diversity and culture.  

The Swatch Revolution combines Swiss excellence in watchmaking with quirky affordable plastic components. Swatch promotes its watches as a means of speaking without words. Wearers of Swatch watches are telling more than just time, they are telling the world something about themselves. Swatch even suggests that wearers share their individuality and preferences on Instagram by tagging #MySwatch.   

Discussion Questions

1. With the Hayek family controlling nearly 40 percent of The Swatch Group, how do you think the family’s influence impacts the corporate culture in the company? What about the company’s international culture being impacted by the Hayek family?

2. Many of the Swatch brands have become cultural icons among a strong core following of customers in the global marketplace. Some even talk about the “Swatch Revolution” that began when Nicolas Hayek founded the company. Why do you think Swatch has such a strong cultural following?

3. As mentioned, Swatch wants you to create your own unique way of accessorizing through its Swatch watch. Is a watch a way to show who a person is culturally? Does a watch get embedded into a person’s culture? Can a watch create a cultural image?

study of the effect of college student employment on academic performance, the following summary statistics for GPA were reported for a sample of students who worked and for a sample of students who did not work. The samples were selected at random from working and nonworking students at a university. (Use a statistical computer package to calculate the P-value. Use μ_employed − μ_{not employed}. Round your test statistic to two decimal places, your df down to the nearest whole number, and your P-value to three decimal places.)

t= df= P=
Does this information support the hypothesis that for students at this university, those who are not employed have a higher mean GPA than those who are employed? Use a significance level of 0.05.