Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN: 9781305506381
Author: James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher: Cengage Learning
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Question
Chapter 2, Problem 7E
a)
To determine
To calculate: The expected price.
b)
To determine
To calculate: The standard deviation of the launch price.
c)
To determine
To find: The probability to receive the price less than $1.2 million.
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The manager of the aerospace division of General Aeronautics has estimated the price it can charge for providing satellite launch services to
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pessimistic estimate (a lower price than this one is not expected more than 10 percent of the time) is $2.0 million. The expected value estimate is
$3.0 million. The price distribution is believed to be approximately normal.
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A large company in the communication and publishing industry has quantified the relationship between the price of one of its products and the demand for this product as Price = 150 - 0.02 x Demand for an annual printing of this particular product. The fixed costs
per year (ie., per printing) = $46,000 and the variable cost per unit=$40. What is the maximum profit that can be achieved? What is the unit price at this point of optimal demand? Demand is not expected to be more than 3,000 units per year.
The maximum profit that can be achieved is $. (Round to the nearest dollar.)
The unit price at the point of optimal demand is $ per unit. (Round to the nearest cent.)
Enter your answer in each of the answer boxes.
Chapter 2 Solutions
Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
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