MANAGERIAL/ECON+BUS/STR CONNECT ACCESS
9th Edition
ISBN: 2810022149537
Author: Baye
Publisher: MCG
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Chapter 1, Problem 23PAA
To determine
To explain:
The advice to be given to the owner of dealership.
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11. You are the manager of a midsized company that assembles personal computers. You
purchase most components-such as random access memory (RAM)-in a competitive
market. Based on your marketing research, consumers earning over $80,000 purchase
1.5 times more RAM than consumers with lower incomes. One morning, you pick up a
copy of The Wall Street Journal and read an article indicating that input components for
RAM are expected to rise in price, forcing manufacturers to produce RAM at a higher
unit cost. Based on this information, what can you expect to happen to the price you
pay for random access memory? Would your answer change if, in addition to this change
in RAM input prices, the article indicated that consumer incomes are expected to fall
over the next two years as the economy dips into recession? Explain. (LO1, LO3, L05)
12. You are the manager of a firm that no d
Your local fast-food chain with two dozen
stores uses the company's internal corporate
marketing department to produce signage,
print ads, in-store displays, and so forth.
When placing an order, store managers are
assessed a chargeback (transfer price) of $80
per order that reduces store profitability but
increases marketing department profitability.
Lately, the store managers have been
ordering more and more marketing services;
the marketing department is swamped, and it
cannot afford to hire more staff.
Which of the following dollar figures is a
possible value for the marginal cost per order
of the marketing department? In other words,
which marginal cost per order for the
marketing department would be consistent
with this situation? Check all that apply.
$104.00
$96.00
$72.00
$108.00
Problem 06-04
For the pizza seller whose marginal, average variable, and average total cost curves are shown in the graph below, what is the profit-
maximizing level of output and how much profit will this producer earn if the price of pizza is $2.50 per slice?
Instructions: In the graph below, label all three curves by clicking on the dropdown to select the appropriate label. Then, indicate the
profit-maximizing level of output on the graph.
Price ($/slice)
3.50
3.25
3.00
2.75
2.50
2.25
2.00
1.75
1.50
1.25
1.00
0.75
0.50
0.25
0
Cost Curves
Select
Select
Quantity (slices/day)
Select
100 200 300 400 500 600 700 800 900
Tools
-i
At the profit-maximizing level of output, the producer's profit is: $
per day.
0
Chapter 1 Solutions
MANAGERIAL/ECON+BUS/STR CONNECT ACCESS
Ch. 1 - Prob. 1CACQCh. 1 - What is the maximum amount you would pay for an...Ch. 1 - Prob. 3CACQCh. 1 - Prob. 4CACQCh. 1 - Prob. 5CACQCh. 1 - Prob. 6CACQCh. 1 - Prob. 7CACQCh. 1 - Prob. 8CACQCh. 1 - Prob. 9CACQCh. 1 - Prob. 10CACQ
Ch. 1 - Prob. 11PAACh. 1 - Prob. 12PAACh. 1 - Prob. 13PAACh. 1 - Prob. 14PAACh. 1 - Prob. 15PAACh. 1 - As a marketing manager for one of the worlds...Ch. 1 - Prob. 17PAACh. 1 - Prob. 18PAACh. 1 - Prob. 19PAACh. 1 - Prob. 20PAACh. 1 - Prob. 21PAACh. 1 - Prob. 22PAACh. 1 - Prob. 23PAACh. 1 - Prob. 24PAA
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