BMW can produce any quantity of cars at a constant marginal cost equal to $20,000 and a fixed cost of $10 billion. You are asked to advise the CEO as to what prices and quantities BMW should set for sales in Europe and in the United States. The demand for BMWs in each market is given by:
Q is at the bottom E = 4,000,000 - 100 P is at the bottom E and Q is at the bottom U = 1,000,000 - 20P its at the bottom U
where the subscript E denotes Europe, the subscript U denotes the United States. Assume that BMW can restrict U.S. sales to authorized BMW dealers only. Please note: All prices and costs are in dollars, NOT thousands of dollars.
a. What quantity of BMWs should the firm sell in each market, and what should the price be in each market?
What should the total profit be?
b. If BMW were forced to charge the same price in each market, what would be the quantity sold in each market, the equilibrium price, and the company's profit?
2. Eggbert Airlines (EA) flies only one route: Minneapolis-Honolulu. The demand for each flight is Q = 300 - P. EA's cost of running each flight is $5,000 plus $150 per passenger.
a. What is the profit-maximizing price that EA will charge? How many people will be on each flight? What is EA's profit for each flight?
b. EA learns that the fixed costs per flight are in fact $7,000 instead of $5,000. Will the airline stay in business for long? Illustrate your answer using a graph of the demand curve that EA faces, EA's average cost curve when fixed costs are $5,000, and EA's average cost curve when fixed costs are $7,000.
c. Wait! EA finds out that two different types of people fly to Honolulu. Type A consists of business people with a demand of QA = 160 - 0.4P. Type B consists of students whose total demand is QB = 140 - 0.6P. Because the students are easy to spot, EA decides to charge them different prices. Graph each of these demand curves and their horizontal sum. What price does EA charge the students? What price does EA charge other customers? How many of each type are on each flight?
d. What would EA's profit be for each flight? Would the airline stay in business?
D Question 4 3 pts Thornton is easily upset, moody, and aggressive. He does not communicate well with peers or adults. According to Baumrind, it is MOST likely that his parents are engaged in_parenting. O abusive O authoritarian O authoritative O permissive D Question 5 3 pts The police department announces the location where they will be enforcing the speed limit. This announcement is MOST likely to affect the behavior of people at the _level of moral development. O preconventional O postconventional O conventional O social contract D Question 6 3 pts Once a child can perform mental operations on tangible objects and events, and understand the principles of conservation and reversibility, she has reached Piaget's_stage. O post-operational O operational O formal operational O concrete operational* Question Completion Status: QUESTION 4 The Positivist School says human behavior is Oa. rational Ob. caused Oc. learned Od. a social contract QUESTION 5 In the social contract we exchange liberty for a. freedom/justice Ob. peace/security Oc. rationality/behavior Od. control/punishment QUESTION 6 Humans are rational hedonists, the seek out the greatest at the least Oa. freedom/justice ()b. crime/punishment Oc. benefit/cost ()d. choice/control QUESTION 7 The person we most associate the Positivist School wth is Oa. Lombroso Ob. Marx ()c. Malinowski ()d. BeccariaQuestion 3 Some researchers who utilise Legitimacy Theory posit that organisations will attempt to operate within the terms of their 'social contract". What is a social contract? Question 4 In 2006 the Australian Government established an inquiry into corporate social responsibilities with the aim of deciding whether the Corporations Act should be amended so as to specifically include particular social and environmental responsibilities within the Act. At the completion of the inquiry it was decided that no specific regulations would be added to the legislation, and that instead, 'market forces' would be relied upon to encourage companies to do the 'right thing' (that is, the view was expressed that if companies did not look after the environment, or did not act in a socially responsible manner, then people would not want to consume the organisations' products, and people would not want to invest in the organisation, work for them, and so forth. Because companies were aware of such market forces they would do the 'right thing' even in the absence of legislation). You are required to explain the decision of the government that no specific regulation be introduced from the perspective of: 1. Public Interest Theory 2. Capture Theory 3. Economic Interest Group Theory of regulation.The Social Contract Theory tells us we must follow whatever moral and legal rules the government decides upon. O True O False QUESTION 14 The Social Contract Theory tells us we must follow whatever moral rules society decides upon. O True O False QUESTION 15 What are three bad things about the Social Contract Theory? Why are they bad things? TTT Arial v 3 (12pt) ~ T - - - - 2 2 Path: p Words:0 / QUESTION 16 What are three good things about the Social Contract Theory? Why are they good things? TTT Arial 3 (12 pt) ~ T - - - - aUESTION 28 What is the name of the mechanism that insures that the social contract is one that free, equal, and rational people would agree to obey? 1. Prisonner's Dilemma O 2. Right of Nature 3. Veil of Ignorance 0 4. Social Contract QUESTION 29 According to Hobbes, morality is impossible without: 0 1. altruism. 0 2. God. 3. the legitimate threat of punishment. 0 4- All of the above. QUESTION 30 What does it mean to say that a moral rule is fundamental? 1. It is always wrong to violate the rule. Click Save and Submit to save and submit. Click Save All Answers to save all answers. Save All Answers Close W O
