Questions from Managerial Economics

Q: Unit labor costs in Germany approach $30 per hour, whereas

Unit labor costs in Germany approach $30 per hour, whereas in Britain unit labor costs are only $20 per hour. Why would such a large difference persist between two members of the EU free trade area?

Q: Extension of the Cobb-Douglas Production Function—The Cobb-

Extension of the Cobb-Douglas Production Function—The Cobb-Douglas production function (Equation 7.16) can be shown to be a special case of a larger class of linear homogeneous produ...

Q: Lobo Lighting Corporation currently employs 100 unskilled laborers, 80 factory technicians

Lobo Lighting Corporation currently employs 100 unskilled laborers, 80 factory technicians, 30 skilled machinists, and 40 skilled electricians. Lobo feels that the marginal product of the last unskill...

Q: Using the data in Table 4.1 for the Sherwin-

Using the data in Table 4.1 for the Sherwin-Williams Company, estimate a multiplicative exponential demand model (see Equation 4.5) for paint sales. Data from Equation 4.5: Data from Table 4.1:...

Q: Bounds Inc. determined through regression analysis that its sales (S

Bounds Inc. determined through regression analysis that its sales (S) are a function of the amount of advertising (measured in units) in two different media. This relationship is given by the followin...

Q: Consider Exercise 3 again. Suppose the owner of the trawler can

Consider Exercise 3 again. Suppose the owner of the trawler can sell all the fish caught for $75 per 100 pounds and can hire as many crew members as desired by paying them $150 per week. Assuming that...

Q: Consider the following short-run production function (where L =

Consider the following short-run production function (where L = variable input, Q = output): a. Determine the marginal product function (MPL). b. Determine the average product function (APL). c. Fin...

Q: Stowe Automotive is considering an offer from Indula to build a plant

Stowe Automotive is considering an offer from Indula to build a plant making automotive parts for use in that country. In preparation for a final decision, Stowe’s economists have been hard at work co...

Q: Conduct an in-class debate on a recent antitrust case and

Conduct an in-class debate on a recent antitrust case and whether it was decided correctly. The case is Leegin Creative Products, Inc. v. PSKS, Inc., DBA Kay’s Kloset, 551, U.S. (2007). Leegin of Dall...

Q: Consider the following short-run production function (where L =

Consider the following short-run production function (where L = variable input, Q = output): Suppose that output can be sold for $10 per unit. Also assume that the firm can obtain as much of the var...