1. The electricity technology (on the roof of all houses) lowers the cost of electricity for each house. Evaluate the statement: each household benefits equally.

2. Justify why the rational expectation of increased future demand in electricity does not cause the above supply and demand curves to change

Assume that two firms are operating with identical cost schedules, but one firm is in a perfectly competitive industry,

and the other is in a monopolistically competitive industry.

- a. Using two correctly labeled graphs, show the long run equilibrium price and output levels for each of these two firms.

- b. Compare the long run equilibrium price and output levels for these two firms.

- c. What level of economic profit will each firm earn in the long run? Why do these results occur?

- d. For each of the two firms at the equilibrium quantity, indicate whether the firm’s demand curve is perfectly elastic, elastic, unit elastic, inelastic, or perfectly inelastic. How can you tell?

What is the origin of the term “benchmark”? How does this apply to cost and management accounting?

Discuss how Diageo's strategy relates to the cost/differentiation and focus strategies .

Discuss how Diageo's strategy relates to the cost/differentiation and focus strategies .

Can BlackRock (Investment management) lower the cost of education? If so how?

Explain the preferred use of historical cost as the basis for recording property and equipment and intangible assets.

If the marginal revenue of a dozen tulips is $12 and marginal cost is $8, why wouldn’t this be an optimal level of production? Please also explain your answer with a figure.

The operation cost of a company is $500,000 this year (year 0). The company expects an annual cost of $100,000 from year 1 to year 5, and the cost decreases by 4% each year from year 6 to year 12. What's the equivalent annual worth if all the expenses occur within years 1-12 ( I=10%)

Xcel is considering a project that has a cost of $12mi, and subsequent cash flows of 3.9mi. for the next 5 years. The firm recognizes that if it waits 1 year, it would have more information about the project, but the cost can go up to $13 mi. There is a 70% chance that market conditions will be favorable if Xcel waits a year, in which case the project will generate net cash flow of $4.6mi. for 5 years. There is a 30% chance that market conditions will be poor, in which case the project will generate net cash flow of $2.5mi. for 5 years. Assume the discount rate is 9%.

a.) Calculate NPV of the project if the firm decides to invest today.

b.) Calculate NPV of the project at t= 0 if the firm decides to wait a year.