1. If when asked how much he or shewould pay to have parcel of land set asidefor a park, the person answers with a lownumber deliberately to influence thedecision, that is an example of:Group of answer choicespolitical biasstrategic biasstarting point biasinformation bias2.If when asked how much he or she wouldpay to have parcel of land set aside for apark, the person answers with a lownumber because the description of theproperty was presented poorly, this is anexample of...Group of answer choicespolitical biasstrategic biasstarting point biasinformation bias

At a marketplace, research is made to identify the behavior of an individual towards a specific…

Answered: 1. If when asked how much he or she…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Portsmouth Bank has foreclosed on a home mortgage and is selling the house at auction. There are three bidders for the house, Emily, Anna, and Olga. Portsmouth Bank does not know the willingness to pay of these three bidders for the house, but on the basis of its previous experience, the bank believes that each of these bidders has a probability of 1/3 of valuing it at $600,000, a probability of 1/3 of valuing at $500,000, and a probability of 1/3 of valuing it at $200,000. Portsmouth Bank believes that these probabilities are independent among buyers. If Portsmouth Bank sells the house by means of a second- bidder, sealed- bid auction (Vicktey auction), what will be the bank's expected revenue from the sale?
Common Cause, a trade union for construction workers, recently took up the case of a worker whose was injured on-site and given no compensation by Hilson Developers. Since incidents like this were frequent, Common Cause began negotiating safer conditions of employment for construction workers with the Federation of Urban Developers. After three rounds of talks, the Federation was still unwilling to increase safety measures. It also refused to increase the compensation for an injured worker and his/her family until the employee was fit to re-join work as it was a nonproductive expenditure. The trade union representatives held onto their stance that since most construction workers were daily wage laborers, they were completely dependent on the developers to provide compensation when they were injured and unable to work. The contract negotiations have now come to a stand still. This is an example of a _____. A.bargaining impasse B.slowdown C. checkoff provision D. lockout E.…
The city council hired three college interns to measure public support for a large parks and recreation initiative in their city. The interns mailed surveys to 500 randomly selected participants in the current public recreation program. They received 150 responses. In this case, which of the following is the population of interest? A.O The participants who support the initiative B.O All members of the community C.O All participants in the city's recreation program D.O The 150 people who responded E. The 500 people who got the survey
Respond to the question with a concise and accurate answer, along with a clear explanation and step-by-step solution, or risk receiving a downvote. Use formulas to solve, not excel Q1. A first-year engineering student wants to purchase a computer for the five years she plans to study engineering. She finds that a well-equipped computer with software can be purchased for $1250. The computer should have a market value of at least $200 if she sells it when she graduates after five years. Assume that no maintenance will be required. Use an interest rate of 9% with monthly compounding. Determine the monthly cost of owning the computer. A. $18.59 B. $23.34 C. $20.42 D. $22.15 E. $25.62
The city council is to decide on a proposal to raise property taxes. Suppose Ms. Tuttle is the chair and the council’s other two members are Mr. Jones and Mrs. Doubtfire. The voting procedure works as follows: Excluding the chair, Mr. Jones and Mrs. Doubtfire simultaneously write down their votes on slips of paper. Each writes either for or against the tax increase. The secretary of the city council then opens the slips of paper and announces the vote tally. If the secretary reports that both slips say for, then the tax increase is implemented and the game is over. If both vote against, then the tax increase is not implemented and, again, the game is over. However, if it is reported that the vote is one for and one against, then Ms. Tuttle has to vote. If she votes for, then the tax increase is implemented, and if she votes against, then it is not. In both cases, the game is then over. As to payoffs, if the tax increase is implemented, then Mrs. Doubtfire and Mr. Jones each receive a…
A computer reseller needs to decide how many laptops to order next month. The lowest end laptop costs $220 and the retailer can sell these for $300. However, the laptop manufacturer already announced that they are coming out with a new model in a couple of months. Any laptops that will not be sold by the end of next month will have to be heavily discounted at half-price. The reseller also needs to consider that every time he fails to fulfill a laptop order, he stands to lose $25 for every unit. Based on the past months’ sales, the reseller estimates the demand probabilities for sales (S) as follows: P(0 units) = 0.3; P(1 units) = 0.4; P(2 units) = 0.2; P(3 units) =0.1. The reseller thinks it’s a good idea to conduct a survey on whether or not his customers are going to buy laptops and how many. The survey results will either be Yes (Y), No (N) or Don’t Know (DK). The probability estimates of the results based on the demand for number of units are: P(Y|S = 0 units) = 0.1 P(Y|S = 1…
In experiments in which participants voluntarily contribute to the provision of a public good, we often find a reduction in contributions in successive rounds of the experiment. We can explain this as Group of answer choices Evidence of participants reaching satiation and not wanting such high levels of the public good. Evidence of participants working out the Nash equilibrium outcome of the voluntary contribution game. Evidence of participants reducing cooperation to punish free riding. Evidence of participants learning how to play the game more effectively.
Firm A is planning to rollout a new nationwide wireless telephone service next month. Its potential customers are either light users or regular users and these exist in equal proportion in the population. The firm must decide between offering a plan with 300 minutes, 600 minutes, or offering both plans. Each of these options costs the firm $10 to provide, and consumers’ willingness to pay is given below: (Image Attached) Each potential customer calculates the net payoff (benefit minus price) that he would get from each of the plans and buys the plan that gives the highest net payoff, so long as the payoff is nonnegative. Assume that if both plans give an equal, non-negative payoff the customer buys the 600 minute plan. a) What prices should the firm set if it wants to offer both plans, such that light users purchase the 300 minute plan and regular users purchase the 600 minute plan? b) How much higher is a regular user’s payoff under the scenario in part (a) above than if the firm…
Next Friday, you plan to sell cakes at a bake sale to raise money for your school. You plan to charge $30 per cake, and you anticipate that you will sell 10 cakes. You can either purchase cakes to sell or bake them yourself. If you purchase the cakes, they will cost $25 each. If you bake your own cakes, your cost depends upon the number of cakes you bake, as shown in the table below. Number of cakes you bake Total cost of baked cakes ($) 0 0 1 10 2 22 3 36 4 52 5 70 6 90 7 112 8 136 9 162 10 190 a) How many cakes should you bake? How many cakes should you purchase? Bake ___ cake(s) and purchase ___ cake(s). b) Given your answer to part a, how much in total will the 10 cakes cost you? $ c) How much would it have cost you to bake all 10 cakes? $ d) How much would it have cost you to purchase all 10 cakes? $
How might imperfect information impact price? Group of answer choices Because buyers cannot determine the true quality of a product, they might tend to bid up the prices. Because they might not be able to present all the information about a product, sellers might temporarily lower the price to make potential buyers think the product is of excellent quality. Imperfect information might tend to cause prices to be perfectly elastic. Buyers cannot distinguish which goods have a higher quality and might be less likely to pay higher prices for that good.
When real estate agents sell their own, rather than clients', houses, they leave the houses on the market for a longer time (10 days longer on average) and wind up with better prices. Suppose that real estate agents earn a commission equal to 3% of the sale value of each house that they help sell. Suppose a real estate agent has an offer on a house of $600,000. The agent can get a 4% higher offer with more effort and by leaving the house on the market for a few more weeks. If the agent sells the house now, she will earn a commission of . By keeping the house on the market and expending more effort to sell the house, the agent can earn a commission of . Thus, the agent gains for the extra effort and time of keeping the house on the market. Suppose a real estate agent has an offer on a house that she owns. The agent has a current offer of $600,000, but can get a 4% higher offer with more effort and by leaving the house on the market for a few more weeks. Assume that all of…
A reserve price is a minimum price set by the auctioneer. If no bidder is willing to pay the reserve price, the item is unsold at a profit of $0 for the auctioneer. If only one bidder values the item at or above the reserve price, that bidder pays the reserve price. An auctioneer faces two bidders, each with a value of either $228 or $304, with both values equally probable. Without a reserve price, the second highest bid will be the price paid by the winning bidder. The following table lists the four possible combinations for bidder values. Each combination is equally likely to occur. On the following table, indicate the price paid by the winning bidder with and without the stated reserve price. Bidder 1 Value Bidder 2 Value Probability Price Without Reserve Price with $304 Reserve Price ($) ($) ($) $228 $228 0.25 $228 $304 0.25 $304 $228 0.25 $304 $304 0.25 Without a reserve price, the expected…

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