Questions from Managerial Economics

Q: “Pay for performance” means that employee compensation closely reflects

“Pay for performance” means that employee compensation closely reflects the amount of value derived from each employee’s effort. In economic terms, the value derived from employee effort is measured...

Q: Determine whether the following production functions exhibit constant, increasing, or

Determine whether the following production functions exhibit constant, increasing, or decreasing returns to scale. a. Q = 0.5X + 2Y + 40Z b. Q = 3L + 10K + 500 c. Q = 4A + 6B + 8AB d. Q = 7L2 + 5LK...

Q: Time Warner, Inc., the world’s largest media and entertainment company

Time Warner, Inc., the world’s largest media and entertainment company, is best known as the publisher of magazines such as Fortune, Time, People, and Sports Illustrated. The Company is a media powerh...

Q: Optimal Compensation Policy. Café-Nervosa.com, based in

Optimal Compensation Policy. Café-Nervosa.com, based in Seattle, Washington, is a rapidly growing family business that offers a line of distinctive coffee products to local and regional c...

Q: The First National Bank received 3,000 inquiries following the latest

The First National Bank received 3,000 inquiries following the latest advertisement describing its 30-month IRA accounts in the Boston World, a local newspaper. The most recent ad in a similar adverti...

Q: Marginal Revenue Product of Labor. To better serve customers interested in

Marginal Revenue Product of Labor. To better serve customers interested in buying cars over the Internet, Smart Motors, Inc., hired Nora Jones to respond to customer inquiries, offer price quotes, and...

Q: Ticket Services, Inc., offers ticket promotion and handling services for

Ticket Services, Inc., offers ticket promotion and handling services for concerts and sporting events. The Sherman Oaks, California, branch office makes heavy use of spot radio advertising on WHAM-AM,...

Q: Net Marginal Revenue. Crane, Poole & Schmidt, LLC is

Net Marginal Revenue. Crane, Poole & Schmidt, LLC is a successful Boston-based law firm. Worker productivity at the firm is measured in billable hours, which vary between partners and associates. Part...

Q: Production Function Estimation. Consider the following Cobb-Douglas production function

Production Function Estimation. Consider the following Cobb-Douglas production function for bus service in a typical metropolitan area: Q = b0 Lb1 kb2 Fb3 Where Q = output in millions of passenge...

Q: Indicate whether each of the following statements is true or false and

Indicate whether each of the following statements is true or false and explain why. a. Constant returns to scale and constant input prices are the only requirements for a total cost function to be lin...