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STALIN [3.7K]
2 years ago
10

Suppose that Verizon Wireless has hired you as a consultant to determine what price it should set for calling services. Suppose

that an individual's inverse demand for wireless services in the greater Boston area is estimated to be P = 100 − 33Q and the marginal cost of providing wireless services to the area is $1 per minute. Compute consumer surplus when Verizon Wireless charges an optimal two-part price.
Business
1 answer:
Feliz [49]2 years ago
3 0

Answer:

If Verizon charges an optimal two-part price thenconsumer surplus will be zero.

Explanation:

Given a competitive market the consumer surplus will be the area of the demand curve above the market price

This is, between the intersection point with Y axis and a parallel at market price. Ofter represent as a triangle

If a monopolistic company maximize profit It will decrease this consumer surplus as much as it can to gain it from itself.

First it will set price equal to his marginal revenue.

Then, if possible it will charge two tariff a fixed component and a variable component per usage This will extrac all consumer surplus in favor of the firm leaving a consumer surplus of zero.

If Verizon charges an optimal two-part price thenconsumer surplus will be zero.

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Which of the following statements regarding an internal rate of return analysis is false?
gulaghasi [49]

Answer: Option D

Explanation: Internal rate of return ,denoted as IRR, is the rate at which the net present value of a capital investment is zero. It is the rate at which the cash flows of the investment are discounted back to calculate the present value.

While, required rate of return is that return which an investor expects to achieve over time from a capital project.

Thus, one would only select a capital project only if the NPV of a project is positive which can only happen when the return on investment, that is, IRR, is greater than cost of capital, that is, required rate of return.

4 0
3 years ago
Lakeside Inc. produces a product that currently sells for $57.60 per unit. Current production costs per unit include direct mate
Sidana [21]

Answer:

It is convenient to make the changes.

Explanation:

Giving the following information:

Selling price= $57.60 per unit.

Direct materials= $22

Direct labor= $24

Variable overhead= $11.00

Fixed overhead= $11.00.

New costs:

Direct material cost= 22*1.2= $26.4

Direct labor cost= 24*1.2= $28.8

<u>I suppose that the selling price will increase by $40.</u>

To determine whether the changes increase profit or not, we need to calculate the unitary contribution margin per unit for both options:

Contribution margin= selling price - unitary variable cost

Actual Contribution margin:

Contribution margin= 57.6 - (22 - 24 - 11)= 0.6

New contribution margin:

Contribution margin= 97.60 - (26.4 - 28.8 - 11)= $31.4

5 0
2 years ago
Which statement BEST explains this investment?
wlad13 [49]

Answer:

I think that the answer is B, The The general likelihood of business success is very high.

Explanation:

I got it right on edgenuity

4 0
3 years ago
Retained earnings:
Lubov Fominskaja [6]

Answer:

1.Generally consists of a company's cumulative net income less any net losses and dividends declared since its inception.

Explanation:

Retained earnings is an element of the balance sheet that represents the accumulated net income and losses and the amount paid to the shareholders over the years as dividend.

Each year, the company's net income or loss from the statement of profit or loss is posted into the retained earnings account.

It is an integral part of the owners equity along with ordinary share capital.

As such, retained earnings generally consists of a company's cumulative net income less any net losses and dividends declared since its inception.

7 0
3 years ago
Describe what an insurance company does and sells without using the word insurance
Crank
If something goes wrong, the company will make sure you're not completely screwed.
8 0
3 years ago
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