2. You are deciding whether to open your own fruit stand in your hometown this summer or just hang around your parent's house. The returns to your decision depend on whether someone else also opens a fruit stand. The payoff matrix for your decision shows your summer earnings and is given below. Someone else Produce Don't Produce Someone else = $0 Produce -$100 each 000ʻI$ = noX NOA Someone else = $1,000 You $0 Don't Produce $0 each a. Identify two possible equilibrium outcomes in this game. b. Suppose your parents decide to subsidize you with a $200 payment if and only if you open your fruit stand. Revise the payoff matrix to account for the subsidy. Produce Don't Produce Produce NOA Don't Produce b. What is the new equilibrium with the subsidy? Has the subsidy served your parents purpose?

2. You are deciding whether to open your own fruit stand in your hometown this summer or just hang around your parent's house. The returns to your decision depend on whether someone else also opens a fruit stand. The payoff matrix for your decision shows your summer earnings and is given below. Someone else Produce Don't Produce Someone else = $0 Produce -$100 each 000ʻI$ = noX NOA Someone else = $1,000 You $0 Don't Produce $0 each a. Identify two possible equilibrium outcomes in this game. b. Suppose your parents decide to subsidize you with a $200 payment if and only if you open your fruit stand. Revise the payoff matrix to account for the subsidy. Produce Don't Produce Produce NOA Don't Produce b. What is the new equilibrium with the subsidy? Has the subsidy served your parents purpose?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

Question 26 Please refer to Maxine's & Daisy's PPFs Which good should Daisy specialize in? Group of answer choices the good for which she has a higher opportunity cost the good she can produce the most of the good for which she has a lower opportunity cost the good for which she has an absolute advantage.
Eric and Kyle are fishermen with different equipment and, as a result, different costs for catching fish. Eric’s costs for catching fish are $1,000 per ton for the first five tons and then $2,500 per ton for any additional tons. Kyle can harvest fish at a cost of $3,000 for the first 15 tons and then $1,400 for any additional tons. a. If society wants 30 tons of fish and for some reason will only allow one of the two guys to do all the fishing, which one should society choose if it wants to minimize the cost of catching those 30 tons of fish? How much will the total cost of catching the fish be? What will the average cost per ton be for the 30 tons? b. If society wants 30 tons of fish and wants them for the least cost regardless of who catches them, how much should Eric and Kyle each catch? How much will the total cost of catching 30 tons be? What will the average cost per ton be for the 30 tons? c. Suppose that Eric and Kyle can both sell whatever amount of fish they catch for $3,000…
Please explain the answer:
6
1. Assume you must choose between two mutually exclusive alternatives: A or B. The explicit benefit you receive from alternative A, bª, is equal to $100. And, the explicit cost of choosing alternative A, c*, is $80. Also, the explicit benefit to choosing alternative B, b", is $120. What is the accounting return for choosing alternative A, r^? Given r and b", what is the explicit cost that you are willingness to pay (WTP) for alternative B, WTP"? Please include the formulas from class in your answer. How would WTPB change ifr^ increased by $5? Explain. your Using the original set of values for explicit costs and benefits, what would be your economic return to choosing alternative How does this relate to the concept of consumer surplus? if the price that you were charged was $95? Please interpret.
1. What are the characteristics of a good theory? What makes a theory practical? How can an entrepreneur use the resource-based theory for his or her advantage? 2. Explain the problems we would have if there was a “law of entrepreneurship.” 3. How does each of the four attributes of resources contribute to SCA?
11- One research is being conducted about how gold prices change due to the changing preferences of individual consumers. Research such as these belong to the study of ______________. a. International economics b. Microeconomics c. Macroeconomics d. Public economics
You pay a cover charge of $50 to get into a popular local nightclub. As the DJ is playing and you are dancing, you suddenly realize that you would much rather be at home studying economics. But $50 is a lot of money for you. Shouldn’t that affect your decision to stay or go? Select one: a. No. The $50 is a sunk cost. b. Yes. The $50 is an avoidable cost. c. Yes. Stay and get your money’s worth. d. No. This is your special night out, so don’t consider costs of any kind.
8. Ann and Barbara are computer programmers in Nashville who are planning to move to Seattle. Each owns a house that has been appraised for $100,000. Ann's house is one of hundreds of highly similar houses in large well-known suburban development, and Barbara's is a one of a kind house built from her architects design. Who will benefit more by hiring a realtor to assist in selling her house?
. Explain why creativity is important in public relations and how it can be used? B. What are key messages? Explain their importance.
ECN 210 Dr. M. Di Liberto Principles of Economics I: Microeconomics Worksheet - Chapter 2 Problem 1 Suppose there are three techniques for producing 1 wool blanket (Techniques 1, 2, and 3), as shown in the table above. а. Given the resource prices shown, which production technique would the firm use? Why? b. Suppose the firm can sell blankets for $26 each. Would the firm be profitable? c. Assume a new technique is developed that economizes on the relatively expensive labor. It requires 2 units of land, one unit of labor, 3 units of capital, and 1 unit of entrepreneurial ability. Would the firm adopt this new technique? d. Suppose the firm's cost of capital rises to $5, all other values being the same. Which technique would the firm now choose? Price per Unit of Resource Resources Required Resource Technique 1 Technique 2 Technique 3 Technique 4 Units Costs Units Costs Units Costs Units Costs Land $2 2 3 Labor $4 2 1 Capital Entrepreneurship $3 $5 1 2 3 1 1 1 1 Total Price per Unit of…
"The four factors of production are needed in an efficient market to provide goods and services at an affordable price at the right time, place and mix,"... "Missing the calibration of these factors can be disastrous for the supplier and consumer." The supplier may face higher costs of production, forcing them to charge a higher price to the consumer or risk going out of business.