N6 The market for athletic shoes is intensely competitive. In 2016, the Sports Authority, one of the firms in the market, decdared bankruptcy and closed ts 500 stores. An Associated Pressarticle discussed the effect of the closings of the Sports Authority stores on Foot Locker's store in the New York City borough of Manhatan, and quoted Foot Locker's CEO as stating"We realized a long time ago that we couldn't be everything to everybody [in one storej. We have defintive brands and experiences."Source: Associated Press, "Foot Locker to Play Up the Store Experience," erainsnewyork.com, August 20, 2010.To maximize profit, a monopolistically compettive firm produces output up to the point whereA. marginal revenue equals demand.OB. demand equals average cost.Oc. marginal revenue equals marginal costD. demand equals marginal cost.A columniet in the Wall Street Journal offers the following opinion of Starbucks: "Starbucks is in some ways the victim of ts success, having attracted increasingly aggressivecompetitors into what is now a fairly crowded market."Source: James Freeman, "Tragedy of the Starbucks Commons," Wa Street Jumal, January 19, 2019.Do all firms that are currently earming an economic profit eventualy become "Victims of their own success?Which of the following statements is true?A. A fim can only hope to eam a profit in the long run ifit is abie to continually find new ways to diferentiate its product.B. Any firm that earns an economic profit will attract competitors as long as mere are significant barriers to entering the firm's marketC. Competition from new entrants wil raise the price for the product and reduce the firm's economic proft to zero.OD. All of the above.JAB, a German company that now owns both Peet's and Intelligentsia, has been focusing on sales of cold-brewed coffee, which it sells in supermarkets and convenience stores.According to an article in the Wall Street Journal, "Making and distributing cold-brewed coffee, in particular, is challenging and expensive because it requires a lot of coffee beans toextract the flavor."Source: Zeke Turner and Julle Jargon, "The Secretive Company That Pours America's Coffee" Wal Street Journal, March 7, 2018.If cold-brew cofeeis more costy for JAB to produce than is convertional ground coffee r hot coffee sodin cofehouses (JAB sels those types of cofle as wel), why would JABfocus on it?OA JAB is hoping to entice more firms to sell cold-brewed coffee to increase its popularity.OB. JAB is following a strategy of diferentiating its product from those offered by competing firms.OC. JAB isn't worred about making a profi-t is a company that is passionate about cold-brew coffeeOD. All of the above.

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Answered: The market for athletic shoes is…

Microeconomics

13th Edition

ISBN:9781337617406

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter9: Perfect Competition

Section: Chapter Questions

Problem 8QP

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Austin is a dot-com entrepreneur who has established a Web site at which people can design and buy awatch. Austin pays $900 a month for a Web server and Internet connection. The watches that customers design are made to order by another firm, and Austin pays this firm $120 a watch. Austin has no other costs. The table shows the demand schedule for Austin's watches. Austin is making an economic profit. In the long run, the demand for Austin's watches OA. decreases; incurs an economic loss OB. increases; makes zero economic profit C. increases, increases his economic profit D. decreases; makes zero economic profit OE. decreases; shuts down and in long-run equilibrium, Austin MIER Price (dollars per watch) 200 160 120 80 40 0 Quantity (watches per month) 0 40 80 120 160 200
The following is a quote from a New York Times article: “If a company makes product donations to the school- computers for instance- then the image of a company goes up as graduate students use the company’s products.” Does such action square with a company’s objective of profit maximization? Discuss and cite one company that makes product donations and how does it help the image of the company
Attempts Average: /3 3. The components of marginal revenue Gilberto's Fire Engines is the sole seller of fire engines in the fictional country of Pyrotania. Initially, Gilberto produced four fire engines, but he has decided to increase production to five fire engines. The following graph shows the demand curve Gilberto faces. As you can see, to sell the additional engine, Gilberto must lower his price from $105,000 to $90,000 per fire engine. Note that while Gilberto gains revenue from the additional engine he sells, he also loses revenue from the initial four engines because he sells them all at the lower price. Use the purple rectangle (diamond symbols) to shade the area representing the revenue lost from the initial four engines by selling at $90,000 rather than $105,000. Then use the green rectangle (triangle symbols) to shade the area representing the revenue gained from selling an additional engine at $90,000. PRICE (Thousands of dollars per fire engine) 150 135 120 105 90 75 0 0…
The components of marginal revenue Andrew's Fire Engines is the sole seller of fire engines in the fictional country of Pyrotania. Initially, Andrew produced eight fire engines, but he has decided to increase production to nine fire engines. The following graph shows the demand curve Andrew faces. As you can see, to sell the additional engine, Andrew must lower his price from $80,000 to $60,000 per fire engine. Note that although Andrew gains revenue from the additional engine he sells, he also loses revenue from the initial eight engines because he sells them all at the lower price. Use the purple rectangle (diamond symbols) to shade the area representing the revenue lost from the initial eight engines by selling at $60,000 rather than $80,000. Then use the green rectangle (triangle symbols) to shade the area representing the revenue gained from selling an additional engine at $60,000. (GRAPH 1) Andrew _____ increase production from 8 to 9 fire engines, because revenue…
Questions Why does Google care whether people think it is large or small? Do highway billboards actually provide competition for Google? Briefly explain.
Which basic competitive strategy does Google follow?
Chapter 16 Homework PRICE (Thousands of dollars per fire engine) 220 Femi 200 180 160 140 120 100 80 60 40 20 0 0 True 1 False 2 4 56 7 QUANTITY (Fire engines) 3 8 Demand 9 10 increase production from 8 to 9 fire engines because the True or False: If alternatively Femi's HookNLadder were a competitive firm and $80,000 were the market price for an engine, decreasing its price from $80,000 to $40,000 would result in the same change in the production quantity and, thus, total revenue. Revenue Lost Revenue Gained dominates in this scenario.
For “Developing a Sampling Plan for a New Menu Initiative Survey,” page 163 Owners of the Santa Fe Grill realize that in order to remain competitive in the restaurant industry, new menu items need to be introduced periodically to provide variety for current customers and to attract new customers. Recognizing this, the owners of the Santa Fe Grill believe three issues need to be addressed using marketing research. The first is should the menu be changed to include items beyond the traditional southwestern cuisine? For example, should they add items that would be considered standard American. Italian. or European cuisine? Second, regardless of the cuisine to be explored, how many new items (e.g., appetizers, entrées, or desserts) should be included on the survey? And third, what type of sampling plan should be developed for selecting respondents, and who should those respondents be? Should they be current customers, new customers, and/or old customers? Determine the appropriate sample…
35 3. The components of marginal revenue Raphael's Fire Engines is the sole seller of fire engines in the fictional country of Pyrotania. Initially, Raphael produced five fire engines, but he has decided to increase production to six fire engines. The following graph shows the demand curve Raphael Faces. As you can see, to sell the additional engine, Raphael must lower his price from $160,000 to $120,000 per fire engine. Note that although Raphael gains revenue from the additional engine he sells, he also loses revenue from the initial five engines because he sells them all at the lower price. Use the purple rectangle (diamond symbols) to shade the area representing the revenue lost from the initial five engines by selling at $120,000 rather than $160,000. Then use the green rectangle (triangle symbols) to shade the area representing the revenue gained from selling an additional engine at $120,000. 200 180 100 5 5 5 5 PRICE (Thousands of dollars par fra angina) 35 Domand Revenue Last 0…
Firm ABC is operating on an inelastic portion of its demand curve. Can a profit maximizing firm operate on an inelastic portion of their demand? Briefly explain.
Briefly explain the condition when firm decide to leave (exit) the market
Dana is a dot-com entrepreneur who has established a Web site at which people can design and buy awatch. Dana pays $200 a month for a Web server and Internet connection. The watches that customers design are made to order by another firm, and Dana pays this firm $60 a watch. Dana has no other costs. The table shows the demand schedule for Dana's watches. What is Dana's profit-maximizing output, price, and economic profit? Dana's profit-maximizing output is Dana's profit-maximizing price is $ Dana's economic profit is $ a month. watches a month. a watch. Price (dollars per watch) 100 80 60 40 20 0 Quantity (watches per month) 0 20 40 60 80 100

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