Questions from Managerial Economics

Q: You’re the manager of global opportunities for a U.S.

You’re the manager of global opportunities for a U.S. Manufacturer, who is considering expanding sales into Asia. Your market research has identified the market potential in Malaysia, Philippines, and...

Q: An individual’s value for a good or service is a.

An individual’s value for a good or service is a. The amount of money he or she used to pay for a good. b. The amount of money he or she is willing to pay for it. c. The amount of money he or she h...

Q: Which of the following will increase the break-even quantity?

Which of the following will increase the break-even quantity? a. A decrease in overall fixed costs b. A decrease in the marginal costs c. A decrease in the price level d. An increase in price level...

Q: The higher the discount rates a. the more value individuals

The higher the discount rates a. the more value individuals place on future dollars b. the more value individuals place on current dollars c. the more investments will take place d. Does not affect...

Q: Assume a firm has the following cost and revenue characteristics at its

Assume a firm has the following cost and revenue characteristics at its current level of output: price=$10.00, average variable cost=$8.00 and average fixed cost =$4.00. This firm is a. incurring a l...

Q: Sarah’s Machinery Company is deciding to dump their current technology A for

Sarah’s Machinery Company is deciding to dump their current technology A for a new technology B with smaller fixed costs but bigger MCs. The current technology has fixed costs of $500 and MCs of $50...

Q: A salesperson can put in regular effort (resulting in a 40

A salesperson can put in regular effort (resulting in a 40% chance of sale) or high effort (60% chance of sale). If high effort costs the salesperson $20 more than regular effort, how large a per-sale...

Q: What is the net present value of a project that requires a

What is the net present value of a project that requires a $100 investment today and returns $50 at the end of the first year and $80 at the end of the second year? Assume a discount rate of 10%. a....

Q: You expect to sell 500 cell phones a month, which have

You expect to sell 500 cell phones a month, which have an MC of $50. If your fixed costs are $5,000 per month, what is the break-even price? a. $10 b. $50 c. $60 d. $100

Q: You are considering opening a new business to sell dartboards. You

You are considering opening a new business to sell dartboards. You estimate that your manufacturing equipment will cost $100,000, facility updates will cost $250,000, and on average it will cost you...