Questions from Managerial Economics

Q: Which products would exhibit a higher elasticity with respect to interest rates

Which products would exhibit a higher elasticity with respect to interest rates, automobiles or small appliances? Why?

Q: Do you believe that profit (or shareholder wealth) maximization still

Do you believe that profit (or shareholder wealth) maximization still represents the best overall economic objective for today’s corporation?

Q: The immediate effect of gasoline price increases in the aftermath of the

The immediate effect of gasoline price increases in the aftermath of the Persian Gulf crisis in August 1990 on gasoline consumption was not very significant. Would you expect the consumption of gasoli...

Q: How do implicit costs lead to a difference between accounting and economic

How do implicit costs lead to a difference between accounting and economic profits?

Q: Could a straight-line demand curve ever have the same elasticity

Could a straight-line demand curve ever have the same elasticity on all its points?

Q: Illustrate the example of the world sugar market with supply and demand

Illustrate the example of the world sugar market with supply and demand diagrams. Be sure to show how the relative shifts in supply and demand have led to the reduction in the world price of sugar.

Q: Various depreciation methods can be used to arrive at an accounting profit

Various depreciation methods can be used to arrive at an accounting profit number. From the viewpoint of the economist, how should annual depreciation be determined?

Q: If a demand curve facing a firm is horizontal or nearly so

If a demand curve facing a firm is horizontal or nearly so, what does it say about this firm’s competition?

Q: You have been asked to produce a forecast for your company’s product

You have been asked to produce a forecast for your company’s product, bottled water. Discuss the kind of information you would look for in order to make this forecast.

Q: If the income elasticity of tomatoes is estimated to approximate +0

If the income elasticity of tomatoes is estimated to approximate +0.25, what would you expect to happen to the consumption of tomatoes as personal income rises?