EBK INTERMEDIATE MICROECONOMICS AND ITS
12th Edition
ISBN: 9781305176386
Author: Snyder
Publisher: YUZU
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Question
Chapter 8.5, Problem 1.1TTA
To determine
To find: Whether the given logic applies with the prevailing market conditions.
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1. Individual Problems 17-1
Malaysia
You're the manager of global opportunities for a U.S. manufacturer that is considering expanding sales into Asia. Your market research has identified
the market potential in Malaysia, the Philippines, and Singapore as described in the following table:
Success Level
Big
Mediocre
Failure
Malaysia
Probability
0.7
0.1
0.2
Units
1,300,000
416,000
Philippines
Probability
0.2
0.3
0.5
Units
600,000
360,000
Singapore
Probability
0.4
0.3
0.3
Units
1,500,000
750,000
The product sells for $20, and each unit has a constant marginal cost of $16. Assume that the (fixed) cost of entering the market (regardless of which
market you select) is $500,000.
Philippines
You're the manager of global opportunities for a U.S. manufacturer that is considering expanding sales into Asia. Your market research has identified
the market potential in Malaysia, the Philippines, and Singapore as described in the following table:
Malaysia
Probability
Units
Philippines
Probability
Units
Singapore
Probability
Units
Big
Success Level
0.3
1,100,000
0.3
1,300,000
Mediocre Failure
0.2
352,000
0.3
650,000
0.1
0.7
600,000 360,000
0.5
0
0.4
0
0.2
0
The product sells for $20, and each unit has a constant marginal cost of $16. Assume that the (fixed) cost of entering the market (regardless of which
market you select) is $500,000.
Ready Foods contracts to buy two hundred carloads of frozen pizzas from Speedy Distributors. Before Ready or Speedy starts performing, can the parties call off the deal? What if Speedy has already shipped the pizzas? Explain your answers.
Chapter 8 Solutions
EBK INTERMEDIATE MICROECONOMICS AND ITS
Ch. 8.3 - Prob. 1MQCh. 8.3 - Prob. 2MQCh. 8.3 - Prob. 1.1MQCh. 8.3 - Prob. 2.1MQCh. 8.4 - Prob. 1TTACh. 8.4 - Prob. 2TTACh. 8.4 - Prob. 1MQCh. 8.4 - Prob. 2MQCh. 8.5 - Prob. 1TTACh. 8.5 - Prob. 2TTA
Ch. 8.5 - Prob. 1.1TTACh. 8.5 - Prob. 2.1TTACh. 8.5 - Prob. 1MQCh. 8.5 - Prob. 2MQCh. 8 - Prob. 1RQCh. 8 - Prob. 2RQCh. 8 - Prob. 3RQCh. 8 - Prob. 4RQCh. 8 - Prob. 5RQCh. 8 - Prob. 6RQCh. 8 - Prob. 7RQCh. 8 - Prob. 8RQCh. 8 - Prob. 9RQCh. 8 - Prob. 10RQCh. 8 - Prob. 8.1PCh. 8 - Prob. 8.2PCh. 8 - Prob. 8.3PCh. 8 - Prob. 8.4PCh. 8 - Prob. 8.5PCh. 8 - Prob. 8.6PCh. 8 - Prob. 8.7PCh. 8 - Prob. 8.8PCh. 8 - Prob. 8.9PCh. 8 - Prob. 8.10P
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