Jim Holzman at Ace Ticket has a few premium seats in the front row. He would like to find out how much extra he can charge for those tickets, relative to identical seats right behind in the second row. To do so, he decided to run a survey. Which of the following questions is LEAST likely to elicit an honest answer? a. What is the most you would be willing to pay for front row seats?
b. Would you purchase front row seats at a 10% premium over second row seats?
c. Giving respondents a tradeoff leads to more honest and accurate responses. Would you rather sit in the first row, or sit in the second row and get a t-shirt with the teamâs name?

The gilbert instrument corporation is considering replacing the wood steamer it currently uses to shape guitar sides. the steamer has 6 years of remaining life. if kept,the steamer will have depreciaiton expenses of $650 for five years and $325 for the sixthyear. its current book value is $3,575, and it can be sold on an internet auction site for$4,150 at this time. if the old steamer is not replaced, it can be sold for $800 at the endof its useful life. gilbert is considering purchasing the side steamer 3000, a higher-end steamer, whichcosts $12,000 and has an estimated useful life of 6 years with an estimated salvage value of$1,500. this steamer falls into the macrs 5-year class, so the applicable depreciationrates are 20.00%, 32.00%, 19.20%, 11.52%, 11.52%, and 5.76%. the new steamer is fasterand allows for an output expansion, so sales would rise by $2,000 per year; the newmachine's much greater efficiency would reduce operating expenses by $1,900 per year.to support the greater sales, the new machine would require that inventories increase by$2,900, but accounts payable would simultaneously increase by $700. gilbert's marginalfederal-plus-state tax rate is 40%, and its wacc is 15%.a. should it replace the old steamer? b. npv of replace = $2,083.51