Bus 640 week 4 assignment

Good Essays
3. Do you expect this profit level to continue in subsequent years? Why or why not?
As the marginal expense of manufacturing is more than the marginal income, it is not feasible for the company to manufacture a positive amount of output although it has got monopoly power by the patent.
During the 1st year, the company has incurred the fixed expense of 120 that it can 't do anything about. But, in the following years the company would go out this market and consequently prevent the fixed expenses incurred. Therefore, the company then would earn profits equal to zero.
2. Greener Grass Company (GGC) competes with its major competitor, Better Lawns and Gardens (BLG), in the delivery and installing of in-ground lawn watering systems in the prosperous western suburbs of a main east-coast town. Previous year, GGC’s price for the standard lawn system was $1,995 compared with BLG’s rate of $2,100. GGC set up 9,130 systems, or roughly 55% of total sales and BLG set up the remaining. (No doubt, several additional systems were set up by do-it-yourself householders because the components are easily available at hardware shops.) GGC has significant additional capacity-it could easily set up 25,000 systems yearly, because it has all the necessary machines and can easily employ and teach installers. As a result, GGC is thinking about growth into the eastern suburbs, in which the people are less prosperous. In earlier years, both GGC and BLG have set up many hundred systems in the eastern suburbs however typically their sales attempts are met with the reaction that the systems are very costly. GGC has employed you to propose a pricing method for both the western and eastern suburb markets for this coming season. You have approximated two distinct demand functions, as follows:
Qw=1,035.548 - 6.07164Pgw + 2.83Pbw + 2,100Ag - 1,500Ab + 0.2348Yw for the western market and
Qe=49,714.29 - 30.7692Pge + 6.984Pbe + 1,180Ag - 950Ab + 0.0825Ye

For the eastern market, where Q

You May Also Find These Documents Helpful

  • Good Essays

    BUS 640 Week 4 Problems

    • 718 Words
    • 3 Pages

    This file of BUS 640 Week 4 Market Structures and Pricing Decisions Applied Problems comprises: Market Structures and Pricing Decisions Applied Problems. Please, complete the following 2 applied problems in a Word or Excel document. Show all your calculations and explain your results. Submit your assignment in the drop box by using the Assignment Submission button. 1. What is the profit-maximizing price and output level? Solve this algebraically for equilibrium P and Q and also plot…

    • 718 Words
    • 3 Pages
    Good Essays
  • Better Essays

    BUS 640 Week 5 Assignment

    • 1360 Words
    • 6 Pages

    Week 5 Assignment BUS 640 Managerial Economics Ashford University January 2014 Week 5 Assignment Problem 1: Jessica Alba, a famous actress, starts the baby and family products business, The Honest Company, with Christopher Gavigan. Alba and Gavigan set up their site so families can choose what kinds of non-toxic, all-natural products they would like to use and get them in a bundle. Families can choose all kinds of products from food to hygiene necessities and cleaning supplies. They…

    • 1360 Words
    • 6 Pages
    Better Essays
  • Satisfactory Essays

    Bus 640 Assignment 3

    • 811 Words
    • 4 Pages

    BUS 640 Dr. Shaw Week 3 Assignment 1 Date Submitted: 9/29/12 Chapter 5: Applied Problem 1 Bridget has limited income and consumes only wine and cheese; her current consumption choice is four bottles of wine and 10 pounds of cheese. The price of wine is $10 per bottle, and the price of cheese is $4 per pound. The last bottle of wine added 50 units to Bridget's utility, while the last pound added 40 units. a) Is Bridget…

    • 811 Words
    • 4 Pages
    Satisfactory Essays
  • Satisfactory Essays

    Bus 640 Week 5

    • 737 Words
    • 3 Pages

    Joe Chatman Ashford University BUS 640 Managerial Economics Dr. David Brownfield January 14, 2013 Chapter 11, Applied Problem, 8 a. This particular industry has a constantly increasing cost. There will be an increase in the demand for input factors for one key reason. Every day, new companies will be introduced into this market of remodeling, economic profits being the encouraging factor. Because of this, there will be a bid…

    • 737 Words
    • 3 Pages
    Satisfactory Essays
  • Satisfactory Essays

    Bus 640

    • 981 Words
    • 4 Pages

    Managerial Decision Kathy Stamps BUS. 640: Managerial Economics Michael Thirtle March 19, 2011 oAbstract Should we buy a new machine or upgrade the old one? One of the managerial decisions that our local hospital had to make was whether to transition into a digital format with our portable x-ray machines by performing transformation upgrades to both existing analog units or to trade them in and use their value to offset the total price incurred by the purchase of new units. This…

    • 981 Words
    • 4 Pages
    Satisfactory Essays
  • Satisfactory Essays

    Bus 640

    • 291 Words
    • 2 Pages

    Jorge Escobar ASHFORD UNIVERSITY BUS 640: Managerial Economics February 25, 2013 John Sellers 1. PV = FV x [ 1 ÷ (1 + i)n ] PV = $11mil x [ 1 ÷ (1 + 0.06)2 ] PV = $11mil x [ 1 ÷ (1.06)2 ] PV = $11mil x [ 1 ÷ 1.1236 ] PV = $11mil x [ 0.88999644] ← PV factor PV = $9,789,960.80 If I were chose between alternative 2 and the first $10min alternative I would go with alternative 1. It reflects a bigger present value than alternative with an opportunity…

    • 291 Words
    • 2 Pages
    Satisfactory Essays
  • Powerful Essays

    Bus 640 Week 6

    • 2732 Words
    • 7 Pages

    Abstract One of the biggest decisions that many people will have to make is whether they should rent or purchase their next residence. There are many advantages and disadvantages in each individual decision. Explicit costs, “monetary opportunity costs of using market-supplied resources,” (Thomas & Maurice, 2011) and implicit costs, “nonmonetary opportunity costs of using owner supplied resources,” (Thomas & Maurice, 2011) are important opportunity costs that each household should dissect…

    • 2732 Words
    • 7 Pages
    Powerful Essays
  • Good Essays

    1. A generous university benefactor has agreed to donate a large amount of money for student scholarships. The money can be provided in one lump-sum of $10mln, or in parts, where $5.5mln can be provided in year 1, and another $5.5mln can be provided in year 2. a) Assuming the opportunity interest rate is 6%, what is the present value of the second alternative? According to Douglas, "a dollar received in the present period is worth more than a dollar received in a future period" (2010, ch. 1…

    • 795 Words
    • 4 Pages
    Good Essays
  • Satisfactory Essays

    BUS 250 Week 4 Assignment

    • 529 Words
    • 3 Pages

    There is BUS 250 Week 4 Assignment Case Study Vidding - Free Expression or Copyright Piracy in this pack. Business - General Business Case Study: Vidding -- Free Expression or Copyright Piracy? Read Case Study Vidding -- Free Expression or Copyright Piracy? at the end of Chapter 13 in your text. In one to two pages, supported by evidence from your text and from other research, respond to the following questions: Using the ethical criteria introduced in Chapter 4 (utilitarianism…

    • 529 Words
    • 3 Pages
    Satisfactory Essays
  • Satisfactory Essays

    BUS 446 Week 4 Assignment

    • 632 Words
    • 4 Pages

    This file includes BUS 446 Week 4 Assignment Just-In-Time Deadline: ( ), Business - Management Assignment 1: Demand Estimation Due Week 3 and worth 200 points Imagine that you work for the maker of a leading brand of low-calorie, frozen microwavable food that estimates the following demand equation for its product using data from 26 supermarkets around the country for the month of April. For a refresher on independent and dependent variables, please go to Sophia’s Website and…

    • 632 Words
    • 4 Pages
    Satisfactory Essays