Two firms compete in selling identical widgets. They choose their output levels Upper Q1 and Q2 simultaneously and face the demand curve:

P=100? Q, where Q=Q₁+Q₂.

Until recently, both firms had zero marginal costs. Recent environmental regulations have increased Firm 2's marginal cost to $50. Firm 1's marginal cost remains constant at zero.

True or false: As a result, the market price will rise to the monopoly level. As a result of Firm 2's marginal cost rising to $50 , the market price:

a)will rise to the monopoly level because Firm 2 will not produce.

b)will rise to the monopoly level because each firm will produce half the monopoly output level.

c)will rise to the monopoly level because both firms will produce less output.

d) will not rise to the monopoly level because Firm 1 will not be profitable.

e) will not rise to the monopoly level because one firm can produce at lower cost than multiple firms.

I am looking for a detailed answer, so please show your work. It is very important for me to understand and learn how to solve this problem.

Performance Tires plans to engage in direct mail advertising. It is currently in negotiations to purchase a mailing list of the names of people who bought sports cars within the last three years. The owner of the mailing list claims that sales generated by contacting names on the list will more than pay for the cost of using the list. (Typically, a company will not sell its list of contacts, but rather provides the mailing services. For example, the owner of the list would handle addressing and mailing catalogs.)

Before it is willing to pay the asking price of $3 per name, the company obtains a sample of 225 names and addresses from the list in order to run a small experiment. It sends a promotional mailing to each of these customers. The data for this exercise show the gross dollar value of the orders produced by this experimental mailing. The company makes a profit of 20% of the gross dollar value of a sale. For example, an order for $100 produces $20 in profit.

Should the company agree to the asking price?

this is one part of the question i am stuck on the other 3 parts i did already

How is the certainty of your decision dependent on the number of names in the sample list? How would, for example, doubling the number of sample names change the certainty of your decision?

Sonic Inc. manufactures two models of speakers, Rumble and Thunder. Based on the following production and sales data for June, prepare (a) a sales budget and (b) a production budget.

a. Prepare a sales budget.

Feedback

b. Prepare a production budget.

1. GDP = C + I + G + X_n

Use the information below to fill in the blanks in the table. Add only the things that are included in GDP to get the nominal GDP. Omit things not counted in GDP. (I filled in a few answers just to help you get started.)

Remember: Real GDP = (Nominal GDP/implicit price deflator) * 100

(All dollar amounts in billions)

A) Find the equation of the tangent line to the curve y = 5e^-8x at the point (0, 5).

B) Solve for t.

e^0.09t = 9

C) Rancher Johann wants to build a three-sided rectangular fence near a river, using 280 yards of fencing. Assume that the river runs straight and that Johann need not fence in the side next to the river.

Johann wants to build a fence so that the enclosed area is maximized.

• What should be the length of each side running perpendicular to the river?
  yards
  
• What should be the length of the side running parallel to the river?
  yards
  
• What is the largest total area that can be enclosed?
  square yards

D) Find the absolute maximum and minimum values on the closed interval [-3,3] for the function below. If a maximum or minimum value does not exist, enter NONE.

f(x) = (4x)/(x² + 1)

E) When a baseball park owner charges $5.00 for admission, there is an average attendance of 100 people. For every $0.25 increase in the admission price, there is a loss of 2 customers from the average number.

1. What admission price should be charged in order to maximize revenue
   
2. What is the maximum revenue?

F) Find the derivative.

f(x) = x⁶ · e^2x

A firm produces output y using two factors of production (inputs), labour L and capital K. The firm’s production function is ?(?,?)=√?+√?=?12+?12. The wage rate w = 6 and the rental price of capital r = 2 are taken as parameters (fixed) by the firm. a. Show whether this firm’s technology exhibits decreasing, constant, or increasing returns to scale. b. Solve the firm’s long run cost minimization problem (minimize long run costs subject to the output constraint) to derive this firm’s i. demand function for labour L = L(y) ii. demand function for capital K = K(y) iii. long run total cost function C = C(y). c. Suppose in the short run, capital is fixed at K = 100. Derive the firm’s short run total cost function C = C(y). d. Derive the AFC, AVC, AC, and MC curves for the firm and graph them on the same diagram – be sure to label them. (Recall: these are short run cost curves). e. Let p be the price of the output y. Derive this firm’s short run supply function y = y(p) assuming it is a competitive firm?

Cendana Berhad has made a profit of RM3 million last year. From those earnings, the company paid the dividend of RM2.00 on each of its 1,000,000 common shares outstanding. The capital structure of the company includes 30% debt, 20% preferred shares and 50% common shares. The corporate tax rate is 28%. The company wishes to venture into a new project and decided to use debt, preferred shares and common shares as sources of financing and still maintaining its current capital structure ratio. Based on the following information, calculate the weighted average cost of capital (WACC) of the company for taking the new project.

You are required to calculate:

i.         The market price of its common share is RM12 and dividend are expected to grow at constant rate of 6% and flotation costs on its new common shares are RM1.50 per share.

ii.        The company can issue 3% dividend preferred shares at a market price of RM10 per share and flotation cost of RM1.00 per share.

iii.       The company can issue 7%, 5 years bonds that can be sold for RM1, 100 each in the market and flotation cost of RM5 per bond.

iv. WACC for taking the new project :

                     (6marks)

On December 31, 2017, Berclair Inc. had 560 million shares of common stock and 5 million shares of 9%, $100 par value cumulative preferred stock issued and outstanding. On March 1, 2018, Berclair purchased 24 million shares of its common stock as treasury stock. Berclair issued a 5% common stock dividend on July 1, 2018. Four million treasury shares were sold on October 1. Net income for the year ended December 31, 2018, was $950 million. The income tax rate is 40%.

Also outstanding at December 31 were incentive stock options granted to key executives on September 13, 2013. The options are exercisable as of September 13, 2017, for 30 million common shares at an exercise price of $56 per share. During 2018, the market price of the common shares averaged $70 per share.

In 2014, $62.5 million of 8% bonds, convertible into 6 million common shares, were issued at face value.

Required:

Compute Berclair’s basic and diluted earnings per share for the year ended December 31, 2018. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).)

Notes for Journal Entries:

1. periodic inventory system and LIFO
2. All credit sales discounts are recorded using the net method – customers receive a 3 percent discount if they pay within 30 days.
3. Purchase discounts are recorded using the net method
4. All depreciation is straight line

Purchased 1,000 units of inventory at $150 a piece on credit from Biggie Smalls Inc. Terms are 2/10; n/60

Paid Biggie full amount owed

Sold inventory with a list price of $22,000 to M Jagger on credit

Accepted a sales return from M Jagger for half of the inventory purchased (i.e., list price of $11,000); And M Jagger paid for the remainder in cash.

Bought 1,000 units of inventory at $170 from Wolfpack Corporation with cash

Returned 100 units of inventory to Wolfpack Corporation for cash

Sold inventory to H Gilmore for $100,000 on credit

H Gilmore paid half of the amount owed

H Gilmore went bankrupt so Kuechly wrote off the balance owed by H Gilmore as uncollectible (hint: Directly write-off this Account since no allowance has been made yet).

Sold Inventory to J Lennon for $30,000 on Credit

Sold Inventory for $200,000 in Cash