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Alecsey [184]
3 years ago
7

In exchange for a share of the revenues earned on campus, State U has granted CheapFizz the exclusive right to sell soft drinks

in the student union and in vending machines on campus. Prior to the deal, three soft drink companies sold beverages on campus; now no other soft drink company is allowed to sell its products on campus. Prior to the deal, a 12-ounce can of CheapFizz sold for 75 cents. After the deal you would expect a 12-ounce can of CheapFizz to sell for:
A. 75 cents because that is the market price.
B. less than 75 cents because CheapFizz will have greater volume and so can lower its price.
C. more than 75 cents because the demand curve for CheapFizz soda will shift to the left.
D. more than 75 cents because CheapFizz is the only company that can sell soda on campus.
Business
1 answer:
evablogger [386]3 years ago
5 0

Answer:

The correct answer is option D.

Explanation:

The price of a 12 ounce can of CheapFizz is 75 cents.

After a deal with State U, CheapFizz gets exclusive rights to sell soft drink on the campus.

This makes CheapFizz a monopoly firm.

A monopoly firm is a price maker and produces at the point where the marginal cost is equal to marginal revenue. At this point the output level is lower than socially optimal and the price level is higher than socially optimal.

This means that the price of CheapFizz cans will be more than 75 cents after the deal.

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The current price for a good is ​$25​, and 100 units are demanded at that price. The price elasticity of demand for the good is
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Answer:

Consumer surplus increases by $2

Explanation:

The consumer surplus can be defined as the benefit that consumers gain when they pay less for a good that they are willing to pay more for.

a). Determine the final demand as follows;

Price elasticity of demand=% change in price/% change in demand

where;

price elasticity of demand=-1

% change in price={(Final price-initial price)/initial price}×100

Final price=$24

initial price=$25

% change in price=(24-25)/25=(1/25)×100=-4%

% change in demand=x

replacing in the original expression;

-1=-4/x

x=4%

% change in quantity={final quantity-initial quantity/initial quantity}×100

let final quantity=y

4%={(y-100)/100}×100

0.04=(y-100)/100

4=y-100

y=4+100=104

final quantity=104 units

Consumer surplus=(1/2)×change in price×change in quantity

where;

change in price=25-24=1

change in quantity=104-100=4

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Consumer surplus increases by $2

8 0
3 years ago
Describe the origins, purposes, and practices of the "long drive" and the "open range" cattle industry. What ended this brief bu
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Answer:

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A homeowner decides to rent a spare bedroom in her single-family house to a tenant for $500 per month. When a 24-year-old man as
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Should not be concerned

Explanation:

In the scenario being described, it can be said that the homeowner should not be concerned. That is because even though she did discriminate against the individual, Single-family homes rented without the use of a real estate agent or advertising are exempt from the federal Fair Housing Act. This holds true as long as the owner of the property does not own more than three homes at any given time. Therefore since there was no real estate agent, the man can't sue.

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You have successfully started and operated a company for the past 10 years. You have decided that it is time to sell your compan
VikaD [51]

Answer:

$5,225,417

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1 quarter         250000

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3 quarters 258064

4 quarters 262193

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10 quarters 288392

11 quarters 293006

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13 quarters 302458

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17 quarters 322284

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19 quarters 332680

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11% = (1 + i/4)⁴

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