1. A perfectly competitive industry faces a demand curve given by Q^D= 2515 – 2P. The long-run total cost curve of each firm is given by LTC = 10q -.2q²+.004q³. Derive the long-run equilibrium values of output per firm, market output, price, and the number of firms.
2. You are told that in long-run perfectly competitive equilibrium each firm produces 25 units and that the marginal cost at that level of output is $10. Solve for the long-run equilibrium values of market output, price, and the number of firms. The market demand is given by Q^D= 4000 – 10P.
3. Assume the world market for calcium is perfectly competitive and that all existing producers and potential entrants are identical. Consider the following information about the price of calcium. Between 1990 and 1995, the market price was stable at $2/pound. In the first three months of 1996, the market price doubled reaching $4/pound, where it stayed for the remainder of 1996. Throughout 1997 and 1998, the price declined, eventually reaching $2/pound by the end of 1998. Between 1998 and 2002, the price remained stable at $2/pound. Assume that technology has not changed and that input prices have remained constant over the period. Using words, explain this pricing pattern over the period.

Common text for questions 3 and 4:

An investor buys three shares of XYZ at the beginning of 2002 for $100 apiece. After one year, the share price has increased to $110 and he receives a dividend per share of $4. Right after receiving the dividend, he buys two additional shares at $110. After another year, the share price has dropped to $90, but the investor still receives a dividend per share of $4. Right after receiving the dividend, he sells one share at $90. After another year, the share price has gone up to $95, the investor receives a dividend per share of $4 and sells all shares at $95 immediately after receiving dividends.

3. What are the arithmetic and geometric average time-weighted rates of return and what is the dollar-weighted rate of return of the investor in the above example (for the dollar-weighted return assume that (i) the cash flows from dividends received at the end of a given year are based on the number of shares held at the beginning of that year, and (ii) cash flows from dividends occur on the same day as the cash flows from buying and selling shares)?

4. Why is the dollar-weighted average rate of return in the above example lower than the geometric average rate of return?

For the following problems, use this information from Thompson Corporation’s annual reports:

These data are included in the file Thompson Data Spring 2019

1. Compute a simple index for the revenue each year of Thompson. Use 2003 as the base period. (4 pts)
2. Compute a simple index for the revenue each year of Thompson using the period 2003–05 as the base. (4 pts)
3. What can you conclude about the change in revenue over this time period? (2 pts.)
4. Compute a simple index for the number of employees each year for Thompson. Use 2003 as the base period. (4 pts)
5. Compute a simple index for the number of employees each year for Thompson using the period 2003–05 as the base. (4 pts)
6. What can you conclude about the change in the number of employees over the period? (2 pts)

The National Sleep Foundation used a survey to determine whether hours of sleeping per night are independent of age (Newsweek, January 19, 2004). The following show the hours of sleep on weeknights for a sample of individuals age 49 and younger and for a sample of individuals age 50 and older.

1. Conduct a test of independence to determine whether the hours of sleep on weeknights are independent of age. Use = .05. Use Table 12.4.
   
   Compute the value of the ² test statistic (to 2 decimals).
   
   
   The p value is Selectless than .005between .005 and .01between .01 and .025between .025 and .05between .05 and .10greater than .10
   
   What is your conclusion?
   SelectConclude age and hours of sleep are not independentCannot reject the assumption that age and hours of sleep are independent
   
2. Using the total sample of 500, estimate the percentage of people who sleep less than 6, 6 to 6.9, 7 to 7.9, and 8 or more hours on weeknights (to 1 decimal).
   

   Less than 6 hours	%
   6 to 6.9 hours	%
   7 to 7.9 hours	%
   8 or more hours	%

At December 31, 2010, Rijo Corporation reported the following plant assets.
Land $ 3,000,000
Buildings $26,500,000
Less: Accumulated depreciation—buildings 12,100,000 14,400,000
Equipment 40,000,000
Less: Accumulated depreciation—equipment 5,000,000 35,000,000
Total plant assets $52,400,000
During 2011, the following selected cash transactions occurred.
Apr. 1 Purchased land for $2,200,000.
May 1 Sold equipment that cost $600,000 when purchased on January 1, 2004.
The equipment was sold for $170,000.
June 1 Sold land for $1,800,000. The land cost $1,000,000.
July 1 Purchased equipment for $1,300,000.
Dec. 31 Retired equipment that cost $500,000 when purchased on December
31, 2001. No salvage value was received.
Instructions
(a) Journalize the transactions. (Hint: You may wish to set up T accounts, post beginning
balances, and then post 2011 transactions.) Rijo uses straight-line depreciation for
buildings and equipment. The buildings are estimated to have a 40-year useful life and
no salvage value; the equipment is estimated to have a 10-year useful life and no sal-
vage value. Update depreciation on assets disposed of at the time of sale or retirement.
(b) Record adjusting entries for depreciation for 2011.
(c) Prepare the plant assets section of Rijo’s balance sheet at December 31, 2011.

A machine shop owner wants to decide whether to purchase a new drill press, new lathe, or new grinder. As shown in the following table, the profit from each purchase will vary depending on whether or not the owner wins a government contract, with the owner estimating a probability of .60 of winning the contract:

Before deciding which item to purchase, the owner needs to decide whether or not to hire a military consultant to assess whether the shop will get the government contract. The track record of the military consultant in predicting whether companies would win government contracts is as follows: For 90% of the companies that won contracts, the consultant had predicted they would win, and for 70% of the companies that lost contracts, the consultant had predicted they would lose. [adapted from Taylor (2004)]

(a) Assuming the consultant would not charge for his assessment, determine the optimal strategy based on the expected value criterion, and state its expected value. (Draw then solve the Decision Tree below)

(b) Determine EVSI (with the consultant regarded as the sample information).

(c) If the consultant were to charge $5,000 for his assessment, what would be the optimal strategy and its expected value?

The National Sleep Foundation used a survey to determine whether hours of sleeping per night are independent of age (Newsweek, January 19, 2004). The following show the hours of sleep on weeknights for a sample of individuals age 49 and younger and for a sample of individuals age 50 and older.

1. Conduct a test of independence to determine whether the hours of sleep on weeknights are independent of age. Use  = .05. Use Table 12.4.
   
   Compute the value of the  ² test statistic (to 2 decimals).
   
   
   The p value is Selectless than .005between .005 and .01between .01 and .025between .025 and .05between .05 and .10greater than .10Item 2
   
   What is your conclusion?
   SelectConclude age and hours of sleep are not independentCannot reject the assumption that age and hours of sleep are independentItem 3
   
2. Using the total sample of 500, estimate the percentage of people who sleep less than 6, 6 to 6.9, 7 to 7.9, and 8 or more hours on weeknights (to 1 decimal).
   

   Less than 6 hours	%
   6 to 6.9 hours	%
   7 to 7.9 hours	%
   8 or more hours	%

Article from that website address （copy the address and open it for read）, and finish those questions after read article. Thanks

The Hidden Cost of Vanilla

Use the article at https://www.danwatch.dk/en/undersogelse/thehiddencostofvanilla/ to answer the following questions.

1. According to the United Nations Development Programme (UNDP) what is the standard of living in Madagascar (what does the majority of the population live on per day?)

2. Who are the parties involved in producing and distributing vanilla from Madagascar?

3. Who has the most control over price? Why?

4. Why do farmers have no influence on pricing?

5. What type of market structure are vanilla farmers operating in? List some of the characteristics of this type of market structure.

6. What was the international price of vanilla in 2003-2004? In 2008-2010? In 2016?

7. Why does the price of vanilla fluctuate so much?

8. Why are children employed in vanilla farming, even though it is illegal for children under the age of 15 to work?

9. What are the “vanilla flower contracts” referred to in the article?

10. Why is the rampant theft of vanilla not addressed?

11. What steps are being taken to change the lives of vanilla farmers?

12. What else would you suggest to improve the situation?

Article from that website address （copy the address and open it for read）, and finish those questions after read article. Thanks

The Hidden Cost of Vanilla

Use the article at https://www.danwatch.dk/en/undersogelse/thehiddencostofvanilla/ to answer the following questions.

1. According to the United Nations Development Programme (UNDP) what is the standard of living in Madagascar (what does the majority of the population live on per day?)

2. Who are the parties involved in producing and distributing vanilla from Madagascar?

3. Who has the most control over price? Why?

4. Why do farmers have no influence on pricing?

5. What type of market structure are vanilla farmers operating in? List some of the characteristics of this type of market structure.

6. What was the international price of vanilla in 2003-2004? In 2008-2010? In 2016?

7. Why does the price of vanilla fluctuate so much?

8. Why are children employed in vanilla farming, even though it is illegal for children under the age of 15 to work?

9. What are the “vanilla flower contracts” referred to in the article?

10. Why is the rampant theft of vanilla not addressed?

11. What steps are being taken to change the lives of vanilla farmers?

12. What else would you suggest to improve the situation?

Article from that website address （copy the address and open it for read）, and finish those questions after read article. Thanks

The Hidden Cost of Vanilla

Use the article at https://www.danwatch.dk/en/undersogelse/thehiddencostofvanilla/ to answer the following questions.

1. According to the United Nations Development Programme (UNDP) what is the standard of living in Madagascar (what does the majority of the population live on per day?)

2. Who are the parties involved in producing and distributing vanilla from Madagascar?

3. Who has the most control over price? Why?

4. Why do farmers have no influence on pricing?

5. What type of market structure are vanilla farmers operating in? List some of the characteristics of this type of market structure.

6. What was the international price of vanilla in 2003-2004? In 2008-2010? In 2016?

7. Why does the price of vanilla fluctuate so much?

8. Why are children employed in vanilla farming, even though it is illegal for children under the age of 15 to work?

9. What are the “vanilla flower contracts” referred to in the article?

10. Why is the rampant theft of vanilla not addressed?

11. What steps are being taken to change the lives of vanilla farmers?

12. What else would you suggest to improve the situation?