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The table below shows the quantities of coffee produced by the 4 major producers in 2005.
We’ll suppose that these are the only producers. These quantities are expressed in bags. (A
bag of coffee has a weight of approximately 132 pounds). Additionally, we know that the
price of coffee in 2005 was approximately 172 USD per bag (172000 USD per thousand bags).
Producer Bags exported (in thousands)
Brazil 26198
Vietnam 13432
Colombia 10871
Indonesia 6744
Suppose that a Cournot model with a linear demand and constant marginal costs is a good
representation of this market. The demand is 𝑃 = 𝑎 − 𝑄.
b) Suppose that in 2006 the marginal cost of Brazil increases by 10% due to a drought. (This
actually happens from time to time).
i) What would be the effect on the international price of coffee?
ii) On the consumer surplus?
iii) On the market shares of each producer?
r?
businesss plan for competitive business
Price skimming is when you have a very high price that makes your product only accessible upmarket.
Consider the two period Repeated Prisoner's Dilemma Game where each player is interested in the SUM of the payoffs she gets in each period. Players see the outcome after the play in each period. (The period payoffs are 10,5,1,0.)
(i) Write out this game in its strategic form.
(ii) Find all Nash equilibria and all Subgame Perfect Nash Equilibria.
3.What type of sales force behavior would be encouraged by paying the salesforce a substantial salary with a small commission?
A.rapidly increasing sales in a new market
B.maintaining existing customers and providing customer service.
C.obtaining new customer
D.encouraging customers to purchase large quantities of product
- Block's sells 500 bottles of perfume a month when the price is $7. A huge increase in resource costs causes price to rise to $9 and Block's only manages to sell 460 bottles of perfume. The price elasticity of demand is:
The Hong Kong government announced on February 2021 a 120 billion HKD (15.5 billion USD) stimulus in its budget to support businesses and individuals struggling from the global pandemic. a. How does this fiscal policy action affect the Hong Kong economy? Use an AA-DD diagram to illustrate the effect. (5 points) b. Assume the Hong Kong Monetary Authority (HKMA) is committed to maintain a fixed exchange rate between the Hong Kong dollar (HKD) and the U.S. dollar (USD). Use an AA-DD diagram to illustrate the effects of HKMA's action in conjunction with this fiscal expansion? (5 points)
In a country such as South Africa, the most important characteristic of the business world in which it operates includes ___________________________.
1. the freedom of individuals to establish any business of their choice
2. the state owning and controlling the community’s resources or factors of production
3. the limited choice of products and services that the state offers
4. the allocation of resources which are not affected by free markets
majestic aircraft carrier is a manufacturer of single engine high performance turboprop aircraft. MAC is considering purchasing composite wing fixtures for the assembly of its signature aircraft. The cost of the assembly system is $3 million with life expectancy of 10 years, annual operating cost of $200000 with zero salvage value. MAC anticipates a stream of $1000000 in revenue per year for 10 years from this project. Assuming MAC uses a MARR of 10 percent, and e=14% is this investment economically justified ? calculate the ERR.
§The Chocolate Emporium in Nottingham makes and sells luxury chocolates.
If the price of a box of chocolates increases from £6.99 to £7.49 and demand falls from 862 units per week to 784 units what is the priced elasticity of demand (P.E.D.) for chocolates
