Markets are separated into two broad categories based on their level of competition. On the one hand there are perfectly competitive markets and on the other hand, there are all other market structures which are grouped under imperfect competition. Markets under imperfect competition are generally described by fewer firms with each firm having some degree of market power depending on the number of firms in the market. Discuss the fundamental differences between perfect competition and imperfect competition (include a discussion of marginal revenue). In addition, discuss how the degree of market power effects the welfare of producers, consumers, and society. 20 Points

Suppose that the market demand for expensive steak dinners is given​ by:

Q = 1,000−10P​,

so that the marginal revenue​ is:

MR = 100−0.2Q​,

where Q is the number of steak dinners per day and P is the price of a dinner. The marginal cost and average total cost are both constant and equal to ​$40 per dinner.

Suppose that there is only one firm in the market.

Suppose that a second firm that produces identical steaks and has identical costs enters the market and acts according to the Cournot oligopoly model.

The equilibrium price is?

The total equilibrium quantity is how many dinners?

Each​ firm's economic profit is?

The demand for Greta’s Grinders can be characterized by the following point elasticities: price elasticity = -0.8, cross-price elasticity with Melvin’s Mashers = -2, and income elasticity = 1.2. Which of the following statements is false?

1. A price increase for Greta Grinders will decrease both the number of units demanded and the total revenue Gail gets.
2. The cross-price elasticity indicates that a 4% increase in the price of Melvin’s Mashers will cause an 8% increase in quantity demanded of Greta Grinders.
3. An 8% price reduction for Greta Grinders would be necessary to overcome the effects of a 4% decline in income.
4. All the above statements are false.  

flake center is considering purchasing new manufacturing equipment for 90000. the old network can be sold for 7000. the new network will require additional working capital of 10000. its anticipated eight-year life will generate additional client revenue of 40000 annually with operating costs, excluding depreciation, of 20000. at the end of eight years, it will have a salvage value of 9000 and return 8000 in working capital. taxes are not included.

1) if the company has a required rate of 12%, what is the net present value of the proposed investment?

2) assume taxes are 30%, what is the after-tax NPV of the proposed investment?

In 2018, Congress overhauled the United States Tax code with The Tax Cut and Job ACT (TCJA). The TCJA lowered the tax bracket for everyone for 10 years. Significant changes to the tax code for individuals were lowered tax brackets and higher standard deductions. Hence, fewer individuals will have to itemize their returns.   However the Corporation and business tax cuts are permanent. Will the Corporate tax cuts increase wages and have positive impact on the economy? Also, will the individual tax cut become permanent in the future? Will the government take in more revenue due to a stronger economy even though it will be less per person?   

True or False

1.The Cross-Price elasticity of demand for good X is -2, if its demand changes from 100 units to 300 units, because of an increase in Price of Good Y from $1 to $2?

2.If the Demand for a good is inelastic, we can say that, as Price decreases, the Total Revenue will decrease.

3.If the demand for a good rises, when income falls, the good is an inferior good.

4.Because of the law of supply, we can be sure that price elasticity of supply, which measure the responsiveness of quantity supplied to a change in market price of the good, will always be NEGATIVE.

Compute the Earning After Tax using both FIFO & LIFO inventory evaluation methods from the following data:

Current operating income for Bay Area Cycles Co. is $32,000. Selling price per unit is $100, the contribution margin ratio is 20%, and fixed expense is $128,000.

Required:

1. Calculate Bay Area Cycle’s per unit variable expense and contribution margin. How many units are currently being sold?

2. How many additional unit sales would be necessary to achieve operating income of $80,000?

4. To study whether movie ratings and release season influence the box office earnings, you gather data on 70 recent movies. You characterize each movie’s rating (G, PG, PG-13, R, or NC-17) and release season (summer or not summer).
   1. Complete the ANOVA table below by filling in the shaded boxes
   2. Find the appropriate critical value(s) [?=0.05]
   3. Does box office revenue significantly vary with rating, release season, or their interaction? Clearly answer for each

   4. 	SS	df	MS	F
      Rating	455
      Season	192.5
      Interaction	140