Business, 02.06.2020 20:57 chrisspa13

Suppose that a monopoly firm finds that its MR is $68 for the first unit sold each day, $67 for the second unit sold each day, $66 for the third unit sold each day, and so on. Further suppose that the first worker hired produces 5 units per day, the second 4 units per day, the third 3 units per day, and so on.

Required:
a. What is the firmâ€™s MRP for each of the first five workers?
b. Suppose that the monopolist is subjected to rate regulation and the regulator stipulates that it must charge exactly $58 per unit for all units sold. At that price, what is the firmâ€™s MRP for each of the first five workers?
c. If the daily wage paid to workers is $242 per day, how many workers will the unregulated monopoly demand?
d. If the daily wage paid to workers falls to $113 per day, how many workers will the unregulated monopoly demand?
e. Comparing your answers to parts c and d, does regulating a monopolyâ€™s output price always increase its demand for resources?

Answers: 1

Show answers

Answers

Answer from: rhineharttori

a. What is the firm's MRP for each of the first five workers?

Worker 1 = $325Worker 2 = $242Worker 3 = $171Worker 4 = $109Worker 5 = $53

The marginal revenue product = units produced x units price

b. Suppose that the monopolist is subjected to rate regulation and the regulator stipulates that it must charge exactly $58 per unit for all units sold. At that price, what is the firm's MRP for each of the first five workers?

Worker 1 = $290Worker 2 = $232Worker 3 = $174Worker 4 = $116Worker 5 = $58

c. If the daily wage paid to workers is $242 per day, how many workers will the unregulated monopoly demand?

2 workers only, since their MRP ≥ $242 per day

d. If the daily wage paid to workers falls to $113 per day, how many workers will the unregulated monopoly demand?

3 workers only, since their MRP ≥ $113 per day

e. Comparing your answers to parts c and d, does regulating a monopoly's output price always increase its demand for resources?

No it doesn't, since regulation always affects markets. Markets need regulation, but that doesn't mean that the effects of regulation are always positive for everyone involved. In this case, regulation is probably good for customers, but bad for the workers employed and the business itself.

Explanation:

unit sold MR worker

1 $67 1

2 $66 1

3 $65 1

4 $64 1

5 $63 1

6 $62 2

7 $61 2

8 $60 2

9 $59 2

10 $58 3

11 $57 3

12 $56 3

13 $55 4

14 $54 4

15 $53 5

Answer from: Quest

Do you have a picture?

Answer from: Quest

The correct answer is step.

Another question on Business

Business, 21.06.2019 19:30

How can a poor housing market put home buyers in a financially unstable position? a. changing property values means it’s easier to find homes with low rental costs. b. when the home value decreases, property taxes and insurance costs increase. c. houses are valued lower than their purchase prices, so the home equity decreases. d. home buyers lose all tax benefits and tax incentives when the housing market goes down. e. mortgage payments can increase even though the home value decreases.

Answers: 1

Answer

Business, 22.06.2019 02:10

Materials purchases (on credit). direct materials used in production. direct labor paid and assigned to work in process inventory. indirect labor paid and assigned to factory overhead. overhead costs applied to work in process inventory. actual overhead costs incurred, including indirect materials. (factory rent and utilities are paid in cash.) transfer of jobs 306 and 307 to finished goods inventory. cost of goods sold for job 306. revenue from the sale of job 306. assignment of any underapplied or overapplied overhead to the cost of goods sold account. (the amount is not material.) 2. prepare journal entries for the month of april to record the above transactions.

Answers: 1

Answer

Business, 22.06.2019 04:50

Neveready flashlights inc. needs $317,000 to take a cash discount of 3/15, net 70. a banker will loan the money for 55 days at an interest cost of $13,200. a. what is the effective rate on the bank loan? (use a 360-day year. do not round intermediate calculations. input your answer as a percent rounded to 2 decimal places.) b. how much would it cost (in percentage terms) if the firm did not take the cash discount but paid the bill in 70 days instead of 15 days? (use a 360-day year. do not round intermediate calculations. input your answer as a percent rounded to 2 decimal places.) c. should the firm borrow the money to take the discount? no yes d. if the banker requires a 20 percent compensating balance, how much must the firm borrow to end up with the $317,000? e-1. what would be the effective interest rate in part d if the interest charge for 55 days were $7,200?

Answers: 3

Answer

Business, 22.06.2019 07:30

Jordan, inc. sells fireworks. the company’s marketing director developed the following cost of goods sold budget for april, may, june, and july. april may june july budgeted cost of goods sold $62,000 $72,000 $82,000 $88,000 jordan had a beginning inventory balance of $3,000 on april 1 and a beginning balance in accounts payable of $14,600. the company desires to maintain an ending inventory balance equal to 15 percent of the next period’s cost of goods sold. jordan makes all purchases on account. the company pays 65 percent of accounts payable in the month of purchase and the remaining 35 percent in the month following purchase. required prepare an inventory purchases budget for april, may, and june. determine the amount of ending inventory jordan will report on the end-of-quarter pro forma balance sheet. prepare a schedule of cash payments for inventory for april, may, and june. determine the balance in accounts payable jordan will report on the end-of-quarter pro forma balance sheet.

Answers: 2

Answer

You know the right answer?

Suppose that a monopoly firm finds that its MR is $68 for the first unit sold each day, $67 for the...

Questions