. We have discussed how abiotic and biotic factors influence the composition and persistence of organisms in different communities over time.   Depending upon the organisms involved, the dynamics can vary dramatically.

a) One example of community change over time occurs during primary succession. Explain how abiotic and biotic factors influence community composition and changes, using examples of your choice. Address relevant environmental characteristics, ecological interactions, and life-history strategies in your answer.

2. The make-up of a community might instead change dramatically in response to a biological invasion. Using an example of your choice, explain how abiotic and biotic factors influence community composition and changes in response to the invasive species. Once again, address relevant environmental characteristics, ecological interactions, and life-history strategies in your answer.

Draw two graphs side-by-side that show the market equilibrium price for soy beans as $3
per pound. The second graph is for Sally the soy bean farmer whose profit maximizing output is 80 pounds of soybeans. Show on your graph Sally making a profit of $140 at the market price of $3. Label all curves you draw and
clearly indicate the profit region.

1. What effect will these long run changes have on either the supply or demand curve in the U.S. Soy bean market?

2. What effect will these long run soy bean market changes have on Sally the soy bean farmer?

3. What happens in the long run to soy bean prices?

4. What happens in the long run to the quantity of soy beans produced in the market?

5. What happens in the long run to the quantity of soy beans produced by Sally?

Q1-Return to the case of the two oil change producers Oil Can Henry’s (OCH) and Jiffy Lube (JL). Recall the inverse market demand for oil changes: P = 100 – 2Q

where quantity is measured in thousands of oil changes per year, representing the combined production of O and G; Q = q_O + q_G; and price is measured in dollars per change. OCH has a marginal cost of $12 per change, and JL has a marginal cost of $20.

Answer the following questions:

a-Suppose the market is a Stackelberg oligopoly and OCH is the first mover. How much does each firm produce? What will the market price be? How much profit does each firm earn?

b-Now suppose JL is the first mover. How much will each firm produce, and what is the market price? How much profit does each firm earn?

1. All else equal, if Canada raises its interest rates,

A) the dollar depreciates.

B) the U.S. demand for Canadian dollars increases.

C) the Canadian supply of Canadian dollars increases.

D) Both A and B.

E) Both A and C.

2. Suppose the exchange rates between the United States and Canada are in long-run equilibrium as defined by the idea of purchasing power parity. If the law of one price holds perfectly, then differences between U.S. and Canadian rates of inflation would

A) have no effect on nominal exchange rates.

B) be completely offset by changes in the real exchange rate.

C) be completely offset by changes in the nominal exchange rate.

D) violate the conditions for the law of one price.

E) lead to a change in the real purchasing power of each country's currency when it is converted to the other country's currency

Question 1-3. Assume the following options are currently available for British pounds (₤):

•Call option premium on British pounds = $.04 per unit

•Put option premium on British pounds = $.03 per unit

•Call option strike price = $1.56

•Put option strike price = $1.53

•One option contract represents ₤31,250.

1. At a long strangle position, what is your profit (loss) when spot exchange rate changes to $1.40

1. -$0.04
2. +$0.14
3. +$0.10
4. +$0.06
5. -$0.06

2. What is the profit (loss) you earn from the Call option in the long strangle position, when spot exchange rate changes to $ 1.53

1. -$0.04
2. -$0.03
3. +$0.03
4. +$0.01
5. -$0.01

3. Determine the break-event point (s) for the long strangle

1. $1.53 and $1.56
2. $1.46 and $ 1.56
3. $1.46 and $ 1,63
4. $1.49 and $1.63
5. $1.48 and $ 1.63

Consider a monopolist facing a constant elasticity demand curve ?(?) = 12? ^−3 .

a) Assume that the total cost function is ??(?) = 5 + 4?. Use the inverse elasticity pricing rule (IEPR) to obtain the profit maximizing price that this monopolist should charge.

b) How would your result in part (a) change if the demand curve changes to ?(?) = 12? ^−5 , but still assuming the same cost function as in part (a)? Interpret your answer.

c) Consider a monopolist facing a constant elasticity demand curve ?(?) = 12? ^−3 . Assume that the total cost function is ??(?) = 5 + 2?^ 2 . Use the inverse elasticity pricing rule (IEPR) to obtain the profit-maximizing price that this monopolist should charge.

d) How would your result in part (c) change if the demand curve changes to ?(?) = 12?^ −5 , but still assuming the same cost function as in part (c)? Interpret your answer.

Consider a monopolist facing a constant elasticity demand curve ?(?) = 12? −3 .

a) Assume that the total cost function is ??(?) = 5 + 4?. Use the inverse elasticity pricing rule (IEPR) to obtain the profit maximizing price that this monopolist should charge.

b) How would your result in part (a) change if the demand curve changes to ?(?) = 12? −5 , but still assuming the same cost function as in part (a)? Interpret your answer.

c) Consider a monopolist facing a constant elasticity demand curve ?(?) = 12? −3 . Assume that the total cost function is ??(?) = 5 + 2? 2 . Use the inverse elasticity pricing rule (IEPR) to obtain the profit-maximizing price that this monopolist should charge.

d) How would your result in part (c) change if the demand curve changes to ?(?) = 12? −5 , but still assuming the same cost function as in part (c)? Interpret your answer.

Use both the TVM equations and a financial calculator to find the following values. Round your answers to the nearest cent. (Hint: Using a financial calculator, you can enter the known values and then press the appropriate key to find the unknown variable. Then, without clearing the TVM register, you can "override" the variable that changes by simply entering a new value for it and then pressing the key for the unknown variable to obtain the second answer. This procedure can be used in parts b and d, and in many other situations, to see how changes in input variables affect the output variable.)

An initial $200 compounded for 10 years at 3.3 percent. $ _________

An initial $200 compounded for 10 years at 6.6 percent. $__________

The present value of $200 due in 10 years at a 3.3 percent discount rate. $________

The present value of $200 due in 10 years at a 6.6 percent discount rate. $_________

We are evaluating a project that costs $604,000, has an eight-year life, and has no salvage value. Assume that depreciation is straight-line to zero over the life of the project. Sales are projected at $55,000 units per year. Price per unit is $36, variable cost per unit is $17, and fixed costs are $685,000 per year. The tax rate is 21 percent, and we require a return of 15 percent on this project.

A. Calculate the accounting breaK-even point.

B. Calculate the house -case cash flow abd NPV. What is the sensitivity if NPVto changes in the sales figure? Explain what your answer tells you about a 500-unit decrease in projected sales.

C. What is the sensitivity of OCF to changes in the variable cost figure?Explain what your answer tells you about $1 decreases is estimated variable costs.