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ECO 550 Final Guide (All Possible Questions)
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Chapter 9—Applications of Cost Theory
MULTIPLE CHOICE
1. Evidence from empirical studies of short-run cost-
output relationships lends support to the:
2. The short-run cost function is:
3. Theoretically, in a long-run cost function:
4. Break-even analysis usually assumes all of the following except:
5. What is another term meaning the degree of operating leverage?
6.
In a study of banking by asset size over time, we can find which asset siz
es are tending to become more prominent. The size that is becoming mo
re predominant is presumed to be least cost. This is called:
7.
George Webb Restaurant collects on the average $5 per customer at its
breakfast & lunch diner. Its variable cost per customer averages $3, and
its annual fixed cost is $40,000. If George Webb wants to make a profit
of $20,000 per year at the diner, it will have to serve__________ custo
mers per year.
8. In determining the shape of the cost-
output relationship only ____ depreciation is relevant.

9.
Which of the following is not a limitation of the survivor technique for m
easuring the optimum size of firms within an industry?
10.
The primary disadvantage of engineering methods for measuring cost fu
nctions is that they deal with the managerial and entrepreneurial aspect
s of the production process or plant.
11. A linear total cost function implies that:
12.
A ____ total cost function implies that marginal costs ____ as output is i
ncreased.
13.
A ____ total cost function implies that marginal costs ____ as output is i
ncreased.
14. A ____ total cost function yields a U-
shaped average total cost function.
15.
In the linear breakeven model, the difference between selling price per u
nit and variable cost per unit is referred to as:
16.
Which of the following is not an assumption of the linear breakeven mod
el:
17.
In the linear breakeven model, the breakeven sales volume (in dollars) is
equal to fixed costs divided by:

18.
The degree of operating leverage is equal to the ____ change in ____ di
vided by the ____ change in ____.
19. The linear breakeven model excludes ____ from the analysis.
20.
In the linear breakeven model, the relevant range of output is that range
where the linearity assumptions of the model are assumed to hold.
21.
In the linear breakeven model, the breakeven sales volume (in dollars) c
an be found by multiplying the breakeven sales volume (in units) by:
22.
In the linear breakeven model, a firm incurs operating losses whenever
output is less than the breakeven level.
PROBLEMS
1. For each of the following cost-
output relationships, describe the shape (U-
shape, decreasing, increasing, constant) of the average total cost and m
arginal cost functions (C = total cost, Q = output):
2.
Offshore Petroleum's fixed costs are $2,500,000 and its debt repayment
requirements are $1,000,000.Selling price per barrel of oil is $18 and v
ariable costs per barrel are $10.
Chapter 10—
Prices, Output, and Strategy: Pure and Monopolistic Competition
MULTIPLE CHOICE

1.
The main difference between perfect competition and monopolistic comp
etition is:
2.
Long distance telephone service has become a competitive market. The a
verage cost per call is $0.05 a minute, and it’s declining. The likely reas
on for the declining price for long distance service is:
3.
What is the profit maximization point for a firm in a purely competitive e
nvironment?
4.
All of the following are true for both competition and monopolistic comp
etition in the long run, except one of them. Which is it?
5.
Which of the following statements is (are) true concerning a pure compe
tition situation?
6. In pure competition:
7. In the short-
run for a purely competitive market, a manufacturer will stop production
when:
8. In the purely competitive case, marginal revenue (MR) is equal to:
9. In long-
run equilibrium, all firms in a pure competition market situation operati
ng under a condition of certainty will have identical costs even though th
ey may use different production and operation techniques.

10.
If price exceeds average costs under pure competition, ____ firms will e
nter the industry, supply will ____, and price will be driven ____.
11. A firm in pure competition would shut down when:
12. In the long-run, firms in a monopolistically competitive industry will
13. Uncertainty includes all of the following except ____.
14. Experience goods are products or services
15.
Buyers anticipate that the temporary warehouse seller of unbranded co
mputer equipment will
16.
All of the following are mechanisms which reduce the adverse selection
problem except ____.
17. Asset specificity is largest when
18. Under asymmetric information,
19.
To escape adverse selection and elicit high quality experience goods buy
ers can
20.
The problems of asymmetric information exchange arise ultimately beca
use
21. The market for "lemons" is one in which

22.
The fraudulent delivery of low quality experience goods at high prices is
more likely if
23. An "experience good" is one that:
24. A "search good" is:
25.
The price for used cars is well below the price of new cars of the same g
eneral quality. This is an example of:
PROBLEMS
1.
Sunrise Juice Company sells its output in a perfectly competitive market.
The firm's total cost function is given in the following schedule:
2.
Superior Metals Company has seen its sales volume decline over the last
few years as the result of rising foreign imports. In order to increase sal
es (and hopefully, profits), the firm is considering a price reduction on l
uranium--
a metal that it produces and sells. The firm currently sells 60,000 pound
s of luranium a year at an average price of $10 per pound. Fixed costs o
f producing luranium are $250,000.Current variable costs per pound ar
e $5. The firm has determined that the variable cost per pound could be
reduced by $.50 if production volume could be increased by 10 percent (
fixed costs would remain constant). The firm's marketing department has
estimated the arc elasticity of demand for luranium to be −1.5.
Chapter 11—
Price and Output Determination: Monopoly and Dominant Firms
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ECO 550 Midterm Part 1 and 2 (All Possible Questions)
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Chapter 1—Introduction and Goals of the Firm
MULTIPLE CHOICE
1. The form of economics most relevant to managerial decision-
making within the firm is:
2.
If one defines incremental cost as the change in total cost resulting from
a decision, and incremental revenue as the change in total revenue resul
ting from a decision, any business decision is profitable if:
3.
In the shareholder wealth maximization model, the value of a firm's stoc
k is equal to the present value of all expected future ____ discounted at t
he stockholders' required rate of return.
4.
Which of the following statements concerning the shareholder wealth ma
ximization model is (are) true?
5. According to the profit-
maximization goal, the firm should attempt to maximize short-
run profits since there is too much uncertainty associated with long-
run profits.

6. According to the innovation theory of profit, above-
normal profits are necessary to compensate the owners of the firm for th
e risk they assume when making their investments.
7. According to the managerial efficiency theory of profit, above-
normal profits can arise because of high-quality managerial skills.
8.
Which of the following (if any) is not a factor affecting the profit perform
ance of firms:
9.
Agency problems and costs are incurred whenever the owners of a firm
delegate decision-making authority to management.
10.
Economic profit is defined as the difference between revenue and ____.
11. Income tax payments are an example of ____.
12.
Various executive compensation plans have been employed to motivate
managers to make decisions that maximize shareholder wealth. These in
clude:
13. The common factors that give rise to all principal-
agent problems include the
14.
The Saturn Corporation (once a division of GM) was permanently close
d in 2009. What went wrong with Saturn?
15. A Real Option Value is:

16.
Which of the following will increase (V0), the shareholder wealth maxim
ization model of the firm:
V0∙(shares outstanding) = S¥t=1(pt ) / (1+ke)t + Real Option Value.
17. The primary objective of a for-profit firm is to ___________.
18. Possible goals of Not-For-
Profit (NFP) enterprises include all of the following EXCEPT:
19. The flat-
screen plasma TVs are selling extremely well. The originators of this tec
hnology are earning higher profits. What theory of profit best reflects th
e performance of the plasma screen makers?
20.
To reduce Agency Problems, executive compensation should be designe
d to:
21.
Recently, the American Medical Association changed its recommendatio
ns on the frequency of pap-
smear exams for women. The new frequency recommendation was desig
ned to address the family histories of the patients. The optimal frequenc
y should be where the marginal benefit of an additional pap-test:
Chapter 2

1.
A change in the level of an economic activity is desirable and should be
undertaken as long as the marginal benefits exceed the ____.
2.
The level of an economic activity should be increased to the point where
the ____ is zero.
3. The net present value of an investment represents
4.
Generally, investors expect that projects with high expected net present
values also will be projects with
5. An closest example of a risk-free security is
6.
The standard deviation is appropriate to compare the risk between two i
nvestments only if
7.
The approximate probability of a value occurring that is greater than on
e standard deviation from the mean is approximately (assuming a norma
l distribution)
8. Based on risk-
return tradeoffs observable in the financial marketplace, which of the fol
lowing securities would you expect to offer higher expected returns than
corporate bonds?
9.
The primary difference(s) between the standard deviation and the coeffic
ient of variation as measures of risk are:
10. The ____ is the ratio of ____ to the ____.

11. Sources of positive net present value projects include
12.
Receiving $100 at the end of the next three years is worth more to me th
an receiving $260 right now, when my required interest rate is 10%.
13.
The number of standard deviations z that a particular value of r is from t
he mean ȓ can be computed as z = (r - ȓ)/ s.
Suppose that you work as a commission-
only insurance agent earning $1,000 per week on average. Suppose that
your standard deviation of weekly earnings is $500. What is the probab
ility that you zero in a week? Use the following brief z-
table to help with this problem.
t
T
14. Consider an investment with the following payoffs and probabilities:
15. Consider an investment with the following payoffs and probabilities:
16. An investment advisor plans a portfolio your 85 year old risk-
averse grandmother. Her portfolio currently consists of 60% bonds and
40% blue chip stocks. This portfolio is estimated to have an expected ret
urn of 6% and with a standard deviation 12%. What is the probability t
hat she makes less than 0% in a year? [A portion of Appendix B1 is give

n below, where z = (x - m)/s , with m as the mean and s
as the standard deviation.]
17.
Two investments have the following expected returns (net present values
) and standard deviations:
PROBLEMS
1.
Suppose that the firm's cost function is given in the following schedule (
where Q is the level of output):
2. Complete the following table.
3.
A firm has decided to invest in a piece of land. Management has estimat
ed that the land can be sold in 5 years for the following possible prices:
Chapter 3—Demand Analysis
MULTIPLE CHOICE
1.
Suppose we estimate that the demand elasticity for fine leather jackets is
.7 at their current prices. Then we know that:
2. If demand were inelastic, then we should i
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ECO 550 Midterm Part 1

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Question 1
Possible goals of Not-For-
Profit (NFP) enterprises include all of the following EXCEPT:
Question 2
In the shareholder wealth maximization model, the value of a firm's stoc
k is equal to the present
value of all expected future ____ discounted at the stockholders' require
d rate of return.
Question 3
Various executive compensation plans have been employed to motivate
managers to make
decisions that maximize shareholder wealth. These include:
Question 4

The primary objective of a for-profit firm is to ___________.
Question 5
To reduce Agency Problems, executive compensation should be designe
d to:
Question 6
Which of the following will increase (V0), the shareholder wealth maxim
ization model of the firm:
V0∙(shares outstanding) = Σ∞t=1 (π t ) / (1+ke)t + Real Option Value.
Question 7
A change in the level of an economic activity is desirable and should be
undertaken as long as the
marginal benefits exceed the ____.

Question 8
The standard deviation is appropriate to compare the risk between two
investments only if
Question 9
Based on risk-
return tradeoffs observable in the financial marketplace, which of the fo
llowing
securities would you expect to offer higher expected returns than corpor
ate bonds?
Question 10
The ____ is the ratio of ____ to the ____.
Question 11

The approximate probability of a value occurring that is greater than on
e standard deviation from
the mean is approximately (assuming a normal distribution)
Question 12
The primary difference(s) between the standard deviation and the coeffi
cient of variation as
measures of risk are:
Question 13
Suppose we estimate that the demand elasticity for fine leather jackets i
s .7 at their current
prices. Then we know that:
Question 14
Producers' goods are:
Question 15

When demand is ____ a percentage change in ____ is exactly offset by t
he same percentage change
in ____ demanded, the net result being a constant total consumer expe
nditure.
Question 16
Songwriters and composers press music companies to lower the price fo
r music downloads because
Question 17
A price elasticity (ED) of −1.50 indicates that for a ____ increase in price,
quantity demanded will
____ by ____.
Question 18

The factor(s) which cause(s) a movement along the demand curve inclu
de(s):
Which of the following would tend to make demand INELASTIC?
Question 20
Even though insignificant explanatory variables can raise the adjusted R
2 of a demand function,
one should not interpret their effects on the regression when
Question 21
In testing whether each individual independent variables (Xs) in a multip
le regression equation is
statistically significant in explaining the dependent variable (Y), one use
s the:
Question 22

The estimated slope coefficient (b) of the regression equation (Ln Y = a +
b Ln X) measures the ____
change in Y for a one ____ change in X.
Question 23
In which of the following econometric problems do we find Durbin-
Watson statistic being far away
from 2.0?
Question 24
When using a multiplicative power function (Y = a X1b1 X2b2 X3b3) to r
epresent an economic
relationship, estimates of the parameters (a, and the b's) using linear re
gression analysis can be
obtained by first applying a ____ transformation to convert the function
to a linear relationship.
Question 25

One commonly used test in checking for the presence of autocorrelation
when working with time
series data is the ____.
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ECO 550 Midterm Part 2
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Question 1
The forecasting technique which attempts to forecast short-
run changes and makes use of economic
indicators known as leading, coincident or lagging indicators is known a
s:
Question 2
Consumer expenditure plans is an example of a forecasting method. Whi
ch of the general categories
best described this example?
Question 3
Which of the following barometric indicators would be the most helpful f
or forecasting future sales
for an industry?
Question 4
The use of quarterly data to develop the forecasting model Yt = a +bYt−
1 is an example of which

forecasting technique?
Question 5
If two alternative economic models are offered, other things equal, we w
ould
Question 6
Smoothing techniques are a form of ____ techniques which assume that t
here is an underlying
pattern to be found in the historical values of a variable that is being for
ecast.
Question 7
In Chinese coastal provinces, brick housing for a fast expanding middle
class is very comparable in
size to housing in the U.S. for a family with median income of $51,000 b
ecause
Question 8
If Ben Bernanke, Chair of the Federal Reserve Board, begins to tighten
monetary policy by raising US
interest rates next year, what is the likely impact on the value of the doll
ar?
Question 9
Companies that reduce their margins on export products in the face of a
ppreciation of their home
currency may be motivated by a desire to

Question 10
Trading partners should specialize in producing goods in accordance wi
th comparative advantage,
then trade and diversify in consumption because
Question 11
If the British pound (₤) appreciates by 10% against the dollar:
Question 12
An appreciation of the U.S. dollar has what impact on Harley-
Davidson (HD), a U.S. manufacturer of
motorcycles?
Question 13
The optimal currency area involves a trade-
off of reducing transaction costs but the inability to use
changes in exchange rates to help ailing regions. If the US, Canada, an
d Mexico had one single
currency (the Peso-
Dollar) we would tend to see all of the following EXCEPT:
Question 14
The isoquants for inputs that are perfect substitutes for one another cons
ist of a series of:
Question 15
Which of the following is never negative?

Question 16
The marginal rate of technical substitution may be defined as all of the f
ollowing except:
Question 17
If the marginal product of labor is 100 and the price of labor is 10, whil
e the marginal product of
capital is 200 and the price of capital is $30, then what should the firm?
Question 18
Marginal factor cost is defined as the amount that an additional unit of t
he variable input adds to
____.
Question 19
The combinations of inputs costing a constant C dollars is called:
Question 20
According to the theory of cost, specialization in the use of variable reso
urces in the short-run
results initially in:
Question 21
If TC = 321 + 55Q - 5Q2, then average total cost at Q = 10 is:
Question 22
Economies of Scope refers to situations where per unit costs are:

Question 23
Economies of scale exist whenever long-run average costs:
Question 24
What method of inventory valuation should be used for economic decisio
n-making problems?
Question 25
The existence of diseconomies of scale (size) for the firm is hypothesized
to result from:
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ECO 550 Week 1 DQ 1 Fundamental Economic Concepts
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"Fundamental Economic Concepts" Please respond to the following:
Answer the following DQs based on the Katrina’s Candies scenario:
From the scenario for Katrina’s Candies, examine the key factors affecti
ng the demand for and the supply of a good in general and Katrina’s Ca
ndies specifically. Distinguish between a change in demand and a chang
e in the quantity demanded (movement along the demand curve).
From the above, indicate the factors that are responsible for a shift in de
mand; and explain how the change is effected by these factors.
Indicate the factors that are responsible for a shift in supply; and explai
n how the change is affected by these factors.
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ECO 550 Week 1 DQ 2 Supply and Demand

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From the e-
Activity, examine the key factors that influence the supply and demand of
the selected good in general and Katrina’s Candies specifically.
Propose two (2) methods in which organizationsthat provide the good m
ay utilize this information. Provide a rationale for your response.
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ECO 550 Week 1-11 All DQs
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ECO 550 Week 1 DQ 1 Fundamental Economic Concepts
ECO 550 Week 1 DQ 2 Supply and Demand
ECO 550 Week 2 DQ 1 Estimating Demand
ECO 550 Week 2 DQ 2 Estimating Elasticity of Demand
ECO 550 Week 3 DQ 1 Managing in the Global Economy
ECO 550 Week 3 DQ 2 Outsourcing Offshore
ECO 550 Week 4 DQ 1 Production Economics
ECO 550 Week 4 DQ 2 Production Decisions
ECO 550 Week 5 DQ 1 Applications of Cost Theory
ECO 550 Week 5 DQ 2 Cost Management
ECO 550 Week 6 DQ 1 Market Structures
ECO 550 Week 6 DQ 2 Maximizing Revenue
ECO 550 Week 7 DQ 1 Predicting Price-Setting Strategies
ECO 550 Week 7 DQ 2 Price-Setting Strategies
ECO 550 Week 8 DQ 1 Entering a Merger
ECO 550 Week 8 DQ 2 Organizational Form
ECO 550 Week 9 DQ 1 Impact of Government Regulation
ECO 550 Week 9 DQ 2 Government Regulation
ECO 550 Week 10 DQ 1 Long-Term Investment
ECO 550 Week 10 DQ 2 Cost-Benefit Analysis

ECO 550 Week 11 DQ 1 Transfer It
ECO 550 Week 11 DQ 2 Best Practices
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ECO 550 Week 2 DQ 1 Estimating Demand
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"Estimating Demand" Please respond to the following:
From the scenario for Katrina’s Candies, examine the procedure Herb
will use to estimate the demand model developed in the scenario for Wee
k 1.
Determine the meaning, relevance, and importance for a manager interp
reting the regression results.
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ECO 550 Week 2 DQ 2 Estimating Elasticity of Demand
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From the e-
Activity, analyze the elasticity of demand for products within the selected
industry relevant to Katrina’s Candies.
Determine the factors involved in making decisions about pricing these
products that you believe to be the most influential.
Provide a rationale for your response.
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ECO 550 Week 3 Assignment 1 Demand Estimation (2 Sets)

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This Tutorial contains 2 Sets
Option 1: Demand equation:
QD = - 5200 - 42P + 20PX + 5.2I + .20A + .25M
(2.002) (17.5) (6.2) (2.5) (0.09) (0.21)
R2 = 0.55 n = 26 F = 4.88
Independent variables:
Q = Quantity demanded of 3-pack units
P (in cents) = Price of the product = 500 cents per 3-pack unit
PX (in cents) = Price of leading competitor’s product = 600 cents per 3-
pack unit
I (in dollars) = Per capita income of the standard metropolitan statistica
l area
(SMSA) in which the supermarkets are located = $5,500
A (in dollars) = Monthly advertising expenditures = $10,000
M = Number of microwave ovens sold in the SMSA in which the superm
arkets are located = 5,000
1. Compute the elasticities for each independent variable
2. Determine the implications for each of the computed elasticities for th
e business in terms of short-term and long-
term pricing strategies. Provide a rationale in which you cite your result
s.
3. Recommend whether you believe that this firm should or should not cu
t its price to increase its market share. Provide support for your recomm
endation.
4. Assume that all the factors affecting demand in this model remain the
same, but that the price has changed. Further assume that the price cha
nges are 100, 200, 300, 400, 500, 600 cents.
a. Plot the demand curve for the firm.
b. Plot the corresponding supply curve on the same graph usi
ng the following MC / supply function Q = -
7909.89 + 79.1P with the same prices.
c. Determine the equilibrium price and quantity.

d. Outline the significant factors that could cause changes in
supply and demand for the low-
calorie, frozen microwavable food. Determine the primary m
anner in which both the short-term and the long-
term changes in market conditions could impact the demand f
or, and the supply, of the product.
5. Indicate the crucial factors that could cause rightward shifts and leftw
ard shifts of the demand and supply curves for the low-
calorie, frozen microwavable food.
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ECO 550 Week 3 DQ 1 Managing in the Global Economy
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"Managing in the Global Economy" Please respond to the following:
· *Answer the following DQs based on the Katrina’s Candies scen
ario:
o From the scenario for Katrina’s Candies, assuming the absence of qu
antitative data, determine the qualitative forecasting techniques that cou
ld be used within this scenario.
o Now, assume you have acquired some time series data that would ena
ble you to make short, medium, and long term forecasts. Ascertain the q
uantitative technique that will provide you with the most accurate foreca
st. Provide a rationale for your responses
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ECO 550 Week 3 DQ 2 Outsourcing Offshore

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"Outsourcing Offshore" Please respond to the following:
· Answer the following DQs on the decision to outsource offshore:
o Aside from maximizing profits, list the key factors that managers sho
uld consider when deciding whether or not to outsource offshore. Deter
mine the key factors that you believe to be the most influential. Provide a
rationale for your response.
o Examine the manner in which the firm’s decision to outsource offshor
e is impacted by foreign exchange. Determine whether or not it matters
where the company outsources offshore. Provide a rationale for your res
ponse.
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ECO 550 Week 4 DQ 1 Production Economics
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ECO 550 Week 4 DQ 1
"Production Economics" Please respond to the following:
· * From the scenario for Katrina’s Candies, determine the relevant
costs for the expansion decision, and distinguish between the short run a
nd the long run costs. Recommend the key decision-
making criteria that Katrina’s Candies should use for expansion decisio
ns in the short run and in the long run. Provide rationale for your respo
nse.
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ECO 550 Week 4 DQ 2 Production Decisions

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ECO 550 Week 4 DQ 2
"Production Decisions" Please respond to the following:
· From the e-
Activity, recommend whether the company in question should or should
not continue to produce the good or service. Provide a rationale for you
r response
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ECO 550 Week 5 DQ 1 Applications of Cost Theory
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ECO 550 Week 5 DQ 1
"Applications of Cost Theory" Please respond to the following:
· * Answer the following DQs based on the Katrina’s Candies scena
rio:
o From the scenario for Katrina’s Candies, determine the appropriate ty
pe of market structure for the situation in question. Cite at least four (4)
defining characteristics that have helped you reach this decision regardin
g the appropriateness of the chosen structure.
o Recommend two (2) kinds of pricing and output strategies that Katrin
a’s Candies should use to reach the goal of profit maximization. Suggest
key modifications that Katrina’s Candies should make in order to mainta

in a competitive advantage when new entrants enter the market. Provide
a rationale for your suggestions.
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ECO 550 Week 5 DQ 2 Cost Management
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ECO 550 Week 5 DQ 2
"Cost Management" Please respond to the following:
· Imagine that you are a manager of a chemical company. An accide
nt has occurred in which chemicals leaked into the ground water nearby
.
The community is unaware of the accident. Compare the primary costs i
nvolved in cleaning up the water immediately (and thus confessing) vers
us
hiding your culpability now and possibly paying more in the future. Pred
ict the impact on profitability in both situations. Justify your response.
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ECO 550 Week 6 Assignment 2 Operations Decisions (2 Papers)
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This Tutorial contains 2 Different Papers
Using the regression results and the other computations from Assignmen
t 1, determine the market structure in which the low-
calorie food company operates.

Use the Internet to research two (2) of the leading competitors in the low
-
calorie microwavable food industry, and take note of their pricing strate
gies, profitability, and their relationships within the industry (worldwide
).
Write a six to eight (6-8) page paper in which you:
1.Outline a plan that will assess the effectiveness of the market structure
for the company’s operations.
2.Suppose the business operations have now changed from the market st
ructure specified in the scenario. Determine two (2) likely factors that m
ight have caused the change. Predict the primary manner in which this c
hange would likely impact business operations in the new market enviro
nment.
3.Analyze the major short-run and long-
run production and cost functions for the low-
calorie microwaveable food company. Suggest substantive ways in whic
h the low-
calorie food company may use this information in order to make decisio
ns in both the short-run and the long-run.
4.Determine the possible circumstances under which the company shoul
d discontinue operations. Suggest key actions that management should t
ake in order to confront these circumstances. Provide a rationale for yo
ur response.
5.Suggest one (1) pricing policy that will enable your low-
calorie microwavable food company to maximize profits. Provide a ratio
nale for your suggestion.
6.Outline a plan, based on the information provided in the scenario, that
the company could use in order to evaluate its financial performance. C
onsider all the key drivers of performance, such as company profit or los
s for both the short term and long term, and the fundamental manner in
which each factor influences managerial decisions.
7.Recommend two (2) actions that the company could take in order to im
prove its profitability and deliver more value to its stakeholders. Outline

, in brief, a plan to implement your recommendations.
8.Use at least five (5) quality academic resources in this assignment. Not
e: Wikipedia does not qualify as an academic resource.
Your assignment must follow these formatting requirements:
•Be typed, double spaced, using Times New Roman font (size 12), with o
ne-
inch margins on all sides; citations and references must follow APA or s
chool-
specific format. Check with your professor for any additional instruction
s.
•Include a cover page containing the title of the assignment, the student’
s name, the professor’s name, the course title, and the date. The cover p
age and the reference page are not included in the required assignment
page length.
The specific course learning outcomes associated with this assignment a
re:
•Analyze short-run and long-run production and cost functions.
•Apply macroeconomic concepts to changes in global and national econ
omies and how they affect economic growth, inflation, interest rates, and
wage rates.
•Evaluate the profit-
maximizing price and output level for given operating costs for monopol
ies and firms in competitive industries.
•Use technology and information resources to research issues in manag
erial economics and globalization.
•Write clearly and concisely about managerial economics and globalizat
ion using proper writing mechanics.
Click here to view the grading rubric.
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ECO 550 Week 6 DQ 1 Market Structures

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ECO 550 Week 6 Discussion 1
"Market Structures" Please respond to the following:
· * From the scenario, assuming Katrina’s Candies is operating in t
he monopolistically competitive market structure and faces the following
weekly demand and short-run cost functions:
VC = 20Q+0.006665 Q2 with MC=20 + 0.01333Q and FC = $5,000
P = 50-0.01Q and MR = 50-0.02Q
*Where price is in $ and Q is in kilograms. All answers should be round
ed to the nearest whole number.
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ECO 550 Week 6 DQ 2 Maximizing Revenue
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"Maximizing Revenue" Please respond to the following:
· * From the scenario, assuming Katrina’s Candies is operating in t
he monopolistically competitive market structure and faces the following
weekly
demand and short-run cost functions:
VC = 20Q+0.006665 Q2 with MC=20 + 0.01333Q and FC = $5,000
P = 50-0.01Q and MR = 50-0.02Q

*Where price is in $ and Q is in kilograms. All answers should be round
ed to the nearest whole number.
-----------------------------------------------------------------------
ECO 550 Week 7 DQ 1 Predicting Price-Setting Strategies
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"Predicting Price-Setting Strategies" Please respond to the following:
· * From the scenario for Katrina’s Candies, determine the importa
nce of predicting the pricing strategies of rival firms in an industry
characterized by mutual interdependence. Provide a rationale for your r
esponse.
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ECO 550 Week 7 DQ 2 Price-Setting Strategies
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"Price-Setting Strategies" Please respond to the following:
· Examine the common price setting strategies of airlines that use ga
me theory. Predict the potential effects of such pricing strategies on the
demand for seats,
and conclude the resulting impact on the profitability of the airlines.
ECO 550 Week 8 DQ 1 Entering a Merger

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"Entering a Merger" Please respond to the following:
· * From the scenario for Katrina’s Candies, examine the major
implications for firms entering into a merger.
Explain the criteria the U.S. Department of Justice and the Federal Trade
Commission would follow when deciding on whether or not to approve
a proposed merger
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ECO 550 Week 8 DQ 2 Organizational Form
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"Organizational Form" Please respond to the following:

· Examine two (2) organizational forms of business (e.g., functional,
product, etc.). Predict the possible implications of the principal agent
relationship
for each of these organizational forms of business. Determine which of
the organization forms would have more of an economic impact on the
operations
of the firm and its ability to maximize profits. Provide a rationale for
your response.
-----------------------------------------------------------------------
ECO 550 Week 9 Assignment 3 Long Term Investment Decision
(2 Papers)
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This Tutorial contains 2 Different Papers
Assume that the low-calorie microwavable food company from
Assignments 1 and 2 wants to expand and has to make some long-term
capital budgeting decisions.
Use the Internet and Strayer databases to research government policies
and regulation.
Write a six to eight (6-8) page paper in which you:

1. Outline a plan that managers in the low-calorie microwaveable food
company could follow when selecting pricing strategies for making their
products as inelastic as possible. Provide a rationale for your response.
2. Examine the major effects that government policies have on
production and employment. Predict the potential effects that
government policies could have on your company.
3. Determine whether or not government regulation to ensure fairness in
the low-calorie microwavable food industry is needed. Cite the major
reasons for government involvement in a market economy. Provide two
(2) examples of government involvement in a similar market economy
to support your response.
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ECO 550 Week 9 DQ 1 Impact of Government Regulation
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"Impact of Government Regulation" Please respond to the following:
· * From the scenario for Katrina’s Candies, take a position as to
whether government regulation is constraining or enabling in this
situation,

as it relates to the operational efficiency of the company. Speculate on
the fundamental manner in which government regulation could impact
the
shareholders’ wealth and profitability.
-----------------------------------------------------------------------
ECO 550 Week 9 DQ 2 Government Regulation
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"Government Regulation" Please respond to the following:
· From the e-Activity, take a position on whether the banking
industry needs more or less government regulation.
Support your position with two (2) examples of the impact of regulation.
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ECO 550 Week 10 DQ 1 Long-Term Investment
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"Long-Term Investment" Please respond to the following:
· * From the scenario for Katrina’s Candies, suggest one (1) method
in which Herb could use a cost-
benefit analysis to argue for or against an expansion.
Create three (3) optimal decision rules for Katrina’s Candies (e.g., whet
her to hire more staff or hire temporary workers to meet production sche
dules).
-----------------------------------------------------------------------
ECO 550 Week 10 DQ 2 Cost-Benefit Analysis
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"Cost-Benefit Analysis" Please respond to the following:
· Assess both the short-term and the long-
term costs and benefits of obtaining a graduate degree.
Support your decision to obtain a graduate degree with a cost-
benefit analysis of your particular situation.
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ECO 550 Week 11 DQ 1 Transfer It
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"Transfer It" Please respond to the following:

· Propose two (2) applications of the knowledge that you have learn
ed in this course to your current or a future position. Provide a rationale
for your response.
-----------------------------------------------------------------------
ECO 550 Week 11 DQ 2 Best Practices
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"Best Practices" Please respond to the following:
· Create a list of three (3) best practices to follow in the field of man
agerial economics and globalization. Provide a rationale for your respo
nse.

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