number and size of buyers, sellers, and potential entrants; (2) the degree of product differentiation; (3) the amount and cost of information about product price and quality; and (4) the conditions for entry and exit. Competitive Markets * A large number of potential buyers and sellers * Product homogeneity * Rapid dissemination of accurate information at low cost * Free entry into and exit from the market Individual buyers and sellers rake the market price for the product as given-no
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|minimum quantities | |Blending |Amount of materials to combine |Minimize cost |Resource limits; Demand | | |to produce one unit of product | |requirements | |Production Line |Sequence of production |Minimize cost |Resource limits; Time requirements| |Scheduling | |
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the 10 principles, I think that 1 People Face Trade-offs, and 2 The Cost of Something is what you give up to get it are the principals that will play a major role in my decision to purchasing a new home. I say “People Face Trade-offs” because in order to buy a house I will have to make sacrifices and give up certain things I like to do so that I can spend that time researching and looking for the perfect home. I chose 2 “The cost of something is what you give up to get it” because not only will I
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Homework #2 Due date: Feb. 8, 2010 Show your work. Answer 100 points worth of questions. 1. (20 pts.) The total cost function at the Tate company is TC = 200 + 3Q + .5Q2, where TC is total cost, and Q is output. a. What is marginal cost (the derivative of TC with respect to Q) when Q = 1? b. What is marginal cost when Q = 5? c. What is marginal cost when Q = 10? d. Graph the TC function in Excel for values of Q ranging from 0 to 20 in increments of one. 2
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x2=1000+500p1+4-50p2 (i). Find the four partial marginal demand functions and determine whether the commodities are competitive or complementary. (ii). Calculate the four partial Elasticities of demand at p1=3 and p1=1. 10. The demand functions for two commodities X1and X2 are each a function of the prices of X1and X2 and are given by x1=4p12p2 and x2=16p1p22 respectively. Find the four partial marginal demand functions and determine whether
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economics, marginal revenue is the revenue that an additionally produced unit will create, if sold. When a company is in a competitive market, the price of the unit sold does not change, so marginal revenue is the price of a single unit. The relationship between marginal revenue and total revenue is calculated when marginal revenue is equal to the change in total revenue divided by the change in quantity, when the change in quantity is equal to a single unit. Mathematically marginal revenue is
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benefits and price based on value for target market This alternative is likely to alter both the cost and benefit of the product by dividing the product in terms of sub-products. One key weakness of TiVo is that it seeks to provide too many benefits. Some of these benefits may be deemed unimportant by specific customer segments. If the cost (and therefore the price) can be reduced by eliminating these marginal benefits, then the value proposition will increase and also will be clear. The three different
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know each of its customers perfectly at each level of consumption, for example the marginal benefit and demand functions for all customers as the firm charges every single customer exactly their marginal benefit. The firm should charge at a price where MB=MC, because as long as MB > MC, the firm will want to keep on producing. However, this scenario is unlikely to happen as the benefits do not outweigh the cost of research to find willingness of each customer. b) The firm should adopt third
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money spent by the consumers on that product or service. Total cost is what it cost the firm to make a product or deliver a service. Total cost includes the purchasing of raw materials, labor, production, transportation, and any other cost incurred by the firm. To gain profit maximization, you have to take total revenue and minus total cost. The point at which the difference is the highest would be the profit maximum. Marginal revenue is the additional profit or revenue that a firm makes
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costly and difficult to obtain transaction costs are high the product is differentiated all of the above | Question 3. 3. (TCO A) Knowledgeable, profit-oriented landlords seek to operate at a level where ___________________________ . (Points : 5) | average revenue equals average cost economic rent equals marginal cost marginal revenue equals marginal cost average revenue equals marginal cost | Question 4. 4. (TCO A) Linkages are ________________________________
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