Search Engine and movie studios are locked in a battle regarding who should be held responsible for piracy. Studios believe that Search Engines can reduce piracy by taking some steps. Engines feel that they are already taking steps and that their user will turn away if they do not provide relevant results to them. Studios already make significant investments to stop piracy. The following table provides pay-off for search engines and studios when they take any action. Studio payoff is underlined.

Engines Action Engines No Action

Studios - Action 2000, 1000 1400, 1300

Studios- No Action 1300, 700 1000, 1500

(i) What will happen in equilibrium and, socially what is the optimal outcome?

(ii) If transaction costs are low, what outcome would be achieved? Explain clearly using the numbers above.

(iii) If transaction costs are high, who should have property rights? Why?

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Seven Star Beverage Limited (SSBL) was making cola drinks and sports drinks and selling in the Northern and Western India since 90's, based on the encouragement given by the Govt.of India New Industrial Policy. However, they remained a small player serving some district markets only. Encouraged by the entered the opening out of the Indian economy and the growth of new middleclass population, many of them globe-trotters, SSBL entered the Indian wine industry in 2000 by acquiring the Himachal Wine Company and three other smaller wine companies near Hyderabad and Nasik.by investing Rs.1 crore. The Indian market for wine is growing fast at the rate of 20% CAGR. But compared to developed countries our annual consumption is less than 0.01%. Everyone was enthusiastic. It was kind of fragmented set up all over India. Many of the old timers in the industry predicted that SSBL would very soon fail. Many were hostile to the entry of SSBL. But it performed well with a volume of 4 lakh cases per month within three years of their first full year of operation. They advertised heavily. They also set up R&D facility and standardised the taste of its wines. They also invested Rs. 1 crore in a new winery at Nasik. By now they came up within the top 10 companies in India The competition also reacted by tripling their combined advertising expenditure. Many top companies resorted to some heavy sales promotion. With liberalization of imports, many good foreign wines of South African, South America and the developed countries have started coming in large quantities. Soon the Indian wine industry growth rate reduced to single digit. In 2010 Mr. R. Goel became the Managing Director of SSBL. In a high-level review, they noted that the company was losing its hold over the market, competition from Indian and imported wines were fierce, operating margins were reducing and it was not getting the return as expected. They compared and found that the company's older business lines in standard and specialty beverages performance was good and steady. Board decided to sell out to ABC Winery Ltd. one of the competitors, get back valuable capital and invest in various non-alcoholic beverages and grow. Within 1 year of the combined operations ABC Winery Ltd moved up from the eighth position in the industry to a strong third place with 15% market share. The Chairman and MD of ABC WL was happy and commented in the Board Meeting that their decision to buy the winery business from SSBL had been a good one. He said "Instead of remaining as a small specialty wine player we have now become a fairly large operation with economies of scale" Mr. Harish, Marketing Manager of SSBL was feeling that they should not have sold their winery business to ABC WL. He said" We could have invested and persisted for few more years, compete with our competitors successfully and improve our market share and become industry leader if we had manufactured wines of new exotic qualities to suit the varied preferences and pockets of diverse sections of society, particularly in the top 40 urban and rich semi-rural locations "

B.1.Was the diversification adopted by SSBL concentric or conglomerate? Explain the meaning of Concentric and Conglomerate and then substantiate your answer

B.2.How would you explain the strategy of ABC WL and why they did better, while HSBL couldn't do it?

B.3.Do you agree with Mr. Harish's views? Whether your answer is YES or No, give appropriate justification

B.4. In the light of opportunities and threats of and its strengths and weaknesses, what strategy should SSBL have followed to improve its performance and strengthen its competitive position. Explain with justification based SWOT analysis

Which of the following is a characteristic of the data collection step in marketing research: A. The least expensive step in marketing research B. The least tedious step in marketing research C. The step in which the most mistakes are made D. The step that is most interesting to researchers 49. Which of the following is an example of a durable good: A. House B. Haircut C. Gasoline D. Hamburger 50. Motives, perception, attitude, lifestyle, personality, and abilities are ___ factors influencing consumer behavior. A. political B. social C. psychological D. economic 51. Business goals are accomplished by means of marketing A. salespeople. B. budgets. C. profit. D. strategies. 52. Products that appeal to the majority of customers are often sold through ___ marketing efforts. A. segmented B. mass C. demographic D. psychographic 53. An important part of a market analysis involves collecting __________ information. A. confidential B. geographic C. employee D. property

1. A country has a natural rate of unemployment of 4 percent, an actual rate of unemployment of 8 percent, and an inflation rate of 4 percent. (1 point)

With the data provided above, draw a fully labeled graph of the short-run and long-run Phillips curves for the country above. Label the short-run equilibrium B. Make sure and label the numerical values provided. If the government takes no action, will the short-run aggregate supply curve shift left, shift right, or not move? Explain. If this country's government takes no action to reduce cyclical unemployment, will the long-run Phillips curve shift left, shift right, or not move? Explain. What is one fiscal policy action that could reduce the unemployment rate in the short run? Assume the policy from part (d) is completely effective. Illustrate the impact of the action from part (d) on the price level and real output with a graph of the aggregate demand and short-run aggregate supply. Assume there is a flexible exchange rate system. As a result of the effect on real GDP from the fiscal policy in part (d), will the currency of this country above

2.

a. It takes Country A two hours to produce a unit of consumer goods and five hours to produce a unit of capital goods. Country B can produce a unit of consumer goods in one hour and a unit of capital goods in four hours. Which country has a comparative advantage in the production of consumer goods? Explain.

b. Country A has the following labor market data:

Employed 91,000 Frictionally unemployed 4,000 Structurally unemployed 2,000 Cyclically unemployed 3,000 Not in the labor force, aged 16 years and over 25,000

Calculate the unemployment rate for Country A.

C. Calculate the labor force participation rate for Country A.

D. Illustrate Country A's current employment of resources every 10 hours on a production possibilities curve with capital goods on the vertical axis and consumer goods on the horizontal axis. Assume constant opportunity costs. Indicate the current employment based on the data from (b) with a point labeled E.

3.

The increased use of credit cards reduces the public's desire to hold onto money. (1 point)

A. Illustrate the effect of the change above on a fully labeled money market graph.

B. Based on the change in the interest rate from part (a), what will happen to the prices of previously issued bonds?

C. What will happen to the price level and real income? Explain.

D. Will the velocity of money in this scenario increase, decrease, remain the same, or is the change indeterminate?

A customer buys a 50-strike put on an index when the market price of the index is also 50. The premium for the put is 5. Assume that the option contract is for an underlying 100 units of the index. Calculate the customer's profit if the index declines to 45 at expiration. (A) -1000 (B) -500 (C) 0 (D) 500 (E) 1000 36 37. A one-year forward contract on a stock has a price of $75. The stock is expected to pay a dividend of $1.50 at two future times, six months from now and one year from now, and the annual effective risk-free interest rate is 6%. Calculate the current stock price. (A) 70.75 (B) 73.63 (C) 75.81 (D) 77.87 (E) 78.0438. The current price of a medical company's stock is 75. The expected value of the stock price in three years is 90 per share. The stock pays no dividends. You are also given i) The risk-free interest rate is positive. ii) There are no transaction costs. iii) Investors require compensation for risk. The price of a three-year forward on a share of this stock is X, and at this price an investor is willing to enter into the forward. Determine what can be concluded about X. (A) X < 75 (B) X = 75 (C) 75 < X < 90 (D) X = 90 (E) 90 < X 39. Determine which of the following strategies creates a ratio spread, assuming all options are European. (A) Buy a one-year call, and sell a three-year call with the same strike price. (B) Buy a one-year call, and sell a three-year call with a different strike price. (C) Buy a one-year call, and buy three one-year calls with a different strike price. (D) Buy a one-year call, and sell three one-year puts with a different strike price. (E) Buy a one-year call, and sell three one-year calls with a different strike price.