Economics of Enterprise Answers

Revenue at a major cellular telephone manufacturer was $2.3 billion for the nine months
ending March 2, up 85 percent over revenues for the same period last year. Management
attributes the increase in revenues to a 108 percent increase in shipments, despite a 21 percent drop in the average blended selling price of its line of phones. Given this information, is it surprising that the company’s revenue increased when it decreased the average selling price of its phones? Explain.

TEXplor has purchased a 2-year lease on land adjacent to the land leased by Clampett. The land leased by TEXplor lies above the same crude oil deposit. Assume

EXAMINERS: DR. AGYAPOMAA GYEKE-DAKO, DR. AMIN KARIMU AND DR. WILLIAM BEKOE PAGE 2 of 4 each company sinks wells of the same size at the same time. If both companies sink wide wells, each will extract 2 million barrels in 6 months, but each company will receive profit of only GHC 1 million. On the other if each company sinks a narrow well, it will take a year for Clampett and TEXplor to extract their respective shares, but their profits will be GHC14 million apiece. Finally, if one company drills a wide well while the other company drills a narrow well, the first company will extract 3 million barrels and the second company will extract only 1 million barrels. In this case, the first company will earn profits of GHC 16 million and the second company will actually lose GHC 1million.

1. Illustrate this using a normal form game.

Management of AG Travel and Tour has identified two groups of individuals that
would be interested in the vacation package consisting of room and board and/or
entertainment. The maximum amount that group 1 is willing to pay for room and
board is GHC 2500 and for entertainment is GHC 500. For group 2, the maximum
amount they are willing to pay for room and board is GHC 1800 and for
entertainment is GHC 750. Although AG Travel and Tour is not able to identify
members of either group, it does know that each group values the components of
the package differently. Assuming there are an equal number of members in each
group and that the total membership in each group is a single individual. If the
marginal cost of providing the service (room and board and/or entertainm

A rational consumer spends income on two goods :bread and milk.when the consumer spends the last unit of income on bread total utility increases from 120 to 140 Utils.when the consumer spends the last unit of income of milk,total utility of milk increases from 50 to 60 utils.given the price of bread pb=4 dollar /unit ,find the price of milk,pm at the equilibrium point.

One evening, you and your friends are at the retail shop and having a great coffee. While sitting and talking, you noticed that there is homework that need to be done and submit by the end of the day.

How can you relate this scenario with economics way of thinking?

when price is high demand is low true or false

assume there is uncertainty about the costs of disposing is the waste: there is 50 50 chance that they will bw $10000 of $30000. Discuss how this uncertainty effects the cost benefit calculation, if the government is risk neutral or very risk averse.

A University is proposing the development of a modern squash court, next to its current residence hall. For the first five years the University has offered to open the court to local players at student rates to secure local support for its planning application. The University will owe the courts anything it wants after five years. Accordingly, the University predicts that total court income for each of the first five years would be $1200, rising by 12% (compounded) in each of the sixth to tenth years. In the eleventh and twelfth years, increasing operating expenses would entirely outweigh increasing revenues, ensuring that net income stays at the pace of ten years. The site’s set for renovation the end of the twelfth year.It is projected the expense of construction the squash is $6500.

If a federal interest rate was imposed by the Government 30% ceiling on all loans that would be earned and who will they lose?