Suppose many firms are working on a vaccine for a particular virus (as is currently the case). Once a successful vaccine is discovered, assume it can be produced by firms at a flat marginal cost of MC = 1. Suppose the demand for vaccines is given by QD = 5 − P. (a) (5) Draw the MC and demand curves on a clearly marked diagram. (b) (5) If this were a competitive market, what would the equilibrium price and quantity be? (c) (5) As discussed in class, what is a major reason that the government would grant monopoly power to the first firm to discover 2 the vaccine? In other words, what’s the problem with leaving this as a competitive market? (d) (5) Now, suppose one firm has monopoly power in this market. Let us think about this firm’s profit-maximizing choice. The firm can choose any quantity, from 0 to 5. As shown in class, fill out a table that has columns for quantity (Q), the associated price (P), the total revenue (TR), and the marginal revenue (MR). (e) (5) What is the firm’s profit-maximizing price and quantity? (f) (5) On a clearly marked diagram, show the dead weight loss associated with the monopoly outcome. (g) (5) Suppose the government is concerned that consumers are being hurt by this inefficiency. Consider the following response from the monopolist: “If you allow us to price discriminate, the market will be more efficient.” Discuss why the government would not be satisfied by this response to its concerns

5. Substitutes, complements, or unrelated?

You work for a marketing firm that has just landed a contract with Run-of-the-Mills to help them promote three of their products: splishy splashies, frizzles, and mookies. All of these products have been on the market for some time, but, to entice better sales, Run-of-the-Mills wants to try a new advertisement that will market two of the products that consumers will likely consume together. As a former economics student, you know that complements are typically consumed together while substitutes can take the place of other goods.

Run-of-the-Mills provides your marketing firm with the following data: When the price of splishy splashies increases by 5%, the quantity of frizzles sold decreases by 4% and the quantity of mookies sold increases by 5%. Your job is to use the cross-price elasticity between splishy splashies and the other goods to determine which goods your marketing firm should advertise together.

Complete the first column of the following table by computing the cross-price elasticity between splishy splashies and frizzles, and then between splishy splashies and mookies. In the second column, determine if splishy splashies are a complement to or a substitute for each of the goods listed. Finally, complete the final column by indicating which good you should recommend marketing with splishy splashies.

Update: Total cost is provided see below. We have to calculate Marginal Revenue numbers and others.

Please advise,

The chart below shows the demand curve for dog food at Charlie’s dog food factory and the total cost of producing various quantities:

Fill in the rest of the chart.

b. How much dog food should Charlie sell, and what price should he charge? Answer first using Method I and then using Method II.

c. If Charlie is required to pay a $5 annual license fee to operate his dog food factory, what happens to his total cost numbers? What happens to his marginal cost numbers? What happens to the amount of dog food he sells and the price he charges?

d. If Charlie is required to pay an excise tax of $6 per pound of dog food, what happens to his total cost numbers? What happens to his marginal cost numbers? What happens to the amount of dog food he sells and the price he charges?

Omni Telecom is trying to decide whether to increase its cash dividend immediately or use the funds to increase its future growth rate.

P₀ = Price of the stock today
D₁ = Dividend at the end of the first year
D₁ = D₀ × (1 + g)
D₀ = Dividend today
K_e = Required rate of return
g = Constant growth rate in dividends

D₀ is currently $3.00, K_e is 11 percent, and g is 6 percent.

Under Plan A, D₀ would be immediately increased to $3.50 and K_e and g will remain unchanged.
Under Plan B, D₀ will remain at $3.00 but g will go up to 7 percent and K_e will remain unchanged.

a. Compute P₀ (price of the stock today) under Plan A. Note D₁ will be equal to D₀ × (1 + g) or $3.50 (1.06). K_e will equal 11 percent, and g will equal 6 percent. (Round your intermediate calculations and final answer to 2 decimal places.)

Stock price for Plan A_________

b. Compute P₀ (price of the stock today) under Plan B. Note D₁ will be equal to D₀ × (1 + g) or $3.00 (1.07). K_e will be equal to 11 percent, and g will be equal to 7 percent. (Round your intermediate calculations and final answer to 2 decimal places.)

c. Which plan will produce the higher value?

plan A or B ?

Mary plans to buy a flat in Tuen Mun, and the selling price is $6,000,000. Mary is offered two mortgage loans: one from Hang Seng Bank (HSB) and another from the developer Sino Group (Sino). (i) a 25-year loan at “Prime rate (P) – 2.8%” from HSB, based on a loan-to-value ratio (LTV) of 60% (ii) a 25-year loan at “Prime rate (P) + 1%” from Sino, based on an LTV of 80%, but Mary can pay interest only in the first three years Both loans require monthly payments and are fully amortizing.

(a) Suppose the prime rate is 5% and is expected to remain constant for a long period of time, calculate the (i) down payments, (ii) monthly payments, and (iii) also the loan balances at the end of Year 3, of the two loans mentioned above.

(b) Calculate the total interest expenses of the two loans. How much do they differ?

(c) Suppose Mary takes up the loan offered by Hang Seng Bank finally. If the housing price is expected to rise by 7% per year, and Mary would like to hold the property for four full years before selling it. Calculate Mary’s expected appreciation on housing price and expected return on equity.

(d) If the housing price grows at the rate expected by Mary, what is her realized return from this investment when she sells the property at the end of Year 4?

( I am posting this for the third time. The first time I posted, whoever did it, he did not read the instruction and did not mention the letters with the answer, such as which one is A, B, C, D, E, F, while he was answering. The 2nd time I posted, whoever did it, he had handwritten it. So, I faced difficulty to understand the handwriting. The handwriting was horrible. Please mention the letters with the answers this time and do not handwrite it, PLEASE. Thank you very much for helping me.)

Managerial Economics Question

1. The Poster Bed Company believes that its industry can best be classified as monopolistically competitive. An analysis of the demand for its canopy bed has resulted in the following estimated demand function for the bed:

P= 1760 - 12Q

The cost analysis department has estimated the total cost function for the poster bed as

TC = (1/3)Q^3 - 15Q^2 + 5Q + 24,000

A) Calculate the level of output that should be produced to maximize short-run profits.

B) What price should be charged?

C) Compute total profits at his price-output level.

D) Compute the point price elasticity of demand at the profit-maximizing level of output.

E) What level of fixed costs is the firm experiencing on its bed production?

F) What is the impact of a $5,000 increase in the level of fixed costs on the price charged, output produced, and profit generated?

Todd Winningham IV has $4,100 to invest. He has been looking at Gallagher Tennis Clubs Inc. common stock. Gallagher has issued a rights offering to its common stockholders. Five rights plus $50 cash will buy one new share. Gallagher’s stock is selling for $70 ex-rights.

a-1. How many rights could Todd buy with his $4,100? (Do not round intermediate calculations and round your answer to the nearest whole number.)

a-2. Alternatively, how many shares of stock could he buy with the same $4,100 at $70 per share?

b. If Todd invests his $4,100 in Gallagher rights and the price of Gallagher stock rises to $75 per share ex-rights, what would his dollar profit on the rights be? (First compute profit per right.)

c. If Todd invests his $4,100 in Gallagher stock and the price of the stock rises to $75 per share ex-rights, what would his total dollar profit be?

d. If Todd invests his $4,100 in Gallagher rights and the price of Gallagher’s stock falls to $42 per share, ex-rights, what would his dollar profit on the rights be?

e. If Todd invests his $4,100 in Gallagher stock and the price of Gallagher’s stock falls to $42 per share ex-rights, what would be his total dollar profit?

Consider the market for onions in India during a two month period (Dec 2010 - Jan 2011). The average price was running around Rs 30 in the first week of Dec 2010 and shot to above Rs 50 by the fourth week of December. The average price level usually hovers around Rs 15. ​Consider that the events were such that both the demand and the supply of onion in India were affected during the two-month period.

Supply Side -India largest producer of onions and government had been supporting aggressive export policies -Highly perishable and lack proper storage facilities (most farmers bring onions to market and unload entire stock within a month of harvest) -Crop is susceptible to disease and pests which can ruin the crop (fungal disease impacted the crop in 2010) -Crop is sensitive to weather (extended monsoon in 2010)

Demand Side -Consumers use onions daily regardless of income -Not many close substitutes and considered to be almost an essential item -Population growing -December-January is when people get married in India as well as seasonal celebrations increasing demand for onions and families stocking up in anticipation

What possible general combination(s) of changes in demand and supply would necessarily lead to an increase in the price of onions? Support your discussion by stating the average price during the two-month period.

JAVA -

The Westfield Carpet Company has asked you to write an application that calculates the price of carpeting for rectangular rooms. To calculate the price, you multiply the area of the floor(width times length) by the price per square foot of carpet. For example, the area of floor that is 12 feet long and 10 feet wide is 120 square feet. To cover that floor with carpet that costs $8 per square foot would cost $960. (12 X 10 X 8 = 960.)

First, you should create a class named RoomDimension that has two fields: one for the length of the room and one for the width. The RoomDimension class should have a method that returns the area of the room. (The area of the room is the room's length multiplied by the room's width.)

Next you should create a RoomCarpet class that has a RoomDimension object as a field. It should also have a field for the cost of the carpet per square foot. The RoomCarpet class should have a method that returns the total cost of the carpet.

Figure 8-21 is a UML diagram that shows possible class designs and the relationships among the classes. Once you have written these classes, use them in an application that asks the user to enter the dimensions of a room and the price epr square foot of the desired carpeting. The application should display the total cost of the carpet.

8-13 ) Required information

Use the following information for the Exercises below.

[The following information applies to the questions displayed below.]

Hart Company made 4,600 bookshelves using 31,000 board feet of wood costing $359,600. The company's direct materials standards for one bookshelf are 7 board feet of wood at $11.50 per board foot.

Exercise 8-13 Computation and interpretation of materials variances LO P2

(1) Compute the direct materials price and quantity variances incurred in manufacturing these bookshelves.

AQ = Actual Quantity
SQ = Standard Quantity
AP = Actual Price
SP = Standard Price
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Exercise 6-5 Absorption costing and variable costing income statements LO P2

Rey Company’s single product sells at a price of $222 per unit. Data for its single product for its first year of operations follow.

1. Prepare an income statement for the year using absorption costing
2. Prepare an income statement for the year using variable costing.