CHAPTER 9 Three conditions for a market to be perfectly competitive? Many buyers and sellers‚ with all firms selling identical products‚ and no barriers to new firms entering the market. In perfectly competitive markets‚ prices are determined by The interaction of market demand and supply because firms and consumers are price takers. Price taker Buyer or seller that is unable to affect the market price. A buyer or seller that takes the market price as given When are firms likely to be
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and exit Short Run Firm has some market power and faces downward sloping demand curve Price exceeds marginal cost When P>AC firms earn positive economic profits Long Run Positive economic profits in short run attracts new firms Firm’s market share falls and demand curve shifts down P=AC firms earn 0 economic profit P>MC and 0 economic profits deadweight loss Market in which only a few firms compete with one another‚ and entry by new firms is impeded Oligopoly Environment Few
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psychology’s roots began 2000 years ago. Now argue that they began 200 years ago. What fields came together to form psychology? Psychology viewed as an old discipline. Psychology can trace its roots to the 5 century BC to the Greek philosophers such as Plato‚ Aristotle and Socrates‚ because we grapple with the same questions they attempted to answer. On the other hand‚ we could view psychology as emerging when philosophy and physiology merged to include experimentation and empirical methods to answer
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Critically discuss the extent to which Psychology as a discipline can be considered: a) scientific and b) objective/value free. The question of Psychology being a science is straightforward. Science is an absolute concept. Something can not be moderately scientific‚ just as something can not be moderately true; it either is or it isn’t‚ as there is no in between measure of the concept. The question of Psychology being objective and value free‚ however‚ is more complex. Objectivity can be achieved
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$10‚000 Utilities $1‚000 Interest on bank loan $10‚000 ________________________________________ Calculate (a)the explicit costs‚ (b) the implicit costs (c) the business profit (d) the economic profit and (e) the normal return on investment in the business. a) Explicit Costs = $45‚000 + $15‚000 + $10‚000 + $1‚000 + $10‚000 = $81‚000 b) Implicit Costs = Opportunity Cost – which is her salary foregone = $25‚000 c)
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The goals of psychological studies are to describe‚ explain‚ predict and perhaps influence mental processes or behaviours. In order to do this‚ psychologists utilize the scientific method to conduct psychological research. The scientific method is a standardized way of making observations‚ gathering data‚ forming theories‚ testing predictions and interpreting results. Knowledge can be acquired through induction or deduction. Induction involves reasoning from the particular to the general. E.g.
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1) Discuss the owner-manager conflict within the firm. Provide two real world manifestations of the conflict. Owner-manager conflicts finds it basis on the self-interested behaviors of managers‚ owners and shareholders. Firm managers may have personal goals that conflict with the owner’s goals of maximizing shareholder wealth. Potential conflicts occur when managers seek to maximize their own utility at the expense of the firm’s shareholders. Conflict between owners and managers typically arise
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(Prof. Alfred Marshall) We can define Nat ional Income as t he collective achievement of a nat ion. In t his way‚ t he Nat ional Income is t he aggregat e of t he individual incomes. (Prof. Gardner Ackley) Nat ional Income is t he basic concept of economic‚ which refers t o t he market value of t he goods and services produced during a part icular year. (Prof. Richard Lipsy) CONCEPTS OF NATIONAL INCOme ----1.GROSS DOMESTIC PRODUct Total value of output (goods and services) produced by the factors
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influence and normative social influence. • Informational social influence or “social proof”‚ our desire to be right in situations in which the correct action or judgement is not obvious and we need information. Example: On your way to a concert‚ but not sure where the entrance is‚ lots of people are going in a certain direction‚ you follow everyone else. You follow because you lack the information so you do whatever everyone else is doing (they must know something you don’t know). • Normative social influence
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Definition of managerial economics 7 1.2 Choice and opportunity cost 9 2.0 Basic concerns of economics 9 3.0.0 Theories of economics 12 3.1.0 The theory of demand 13 3.1.1 Tastes 14 3.1.2 Number of buyers 14 3.1.3 Income 14 3.1.5 Expectations 15 3.2 The theory of supply 16 3.3 The theory of production 16 3.4 The theory of price( in government) 17 3.5 The theory of consumer behaviour 17 3.5.1 Rational behaviour 17 3.5.2 Preferences 17 3.5.3 Budget constraint 18 3.5.4 Prices 18 4.0 Managerial Economics and Economic
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