Questions from Managerial Economics


Q: What is price discrimination?

What is price discrimination?

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Q: What conditions are necessary before price discrimination is both possible and profitable

What conditions are necessary before price discrimination is both possible and profitable? Why does price discrimination result in higher profits?

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Q: Discuss the role of common costs in pricing practice.

Discuss the role of common costs in pricing practice.

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Q: “The decision to start your own firm and go into business

“The decision to start your own firm and go into business can be thought of as a capital budgeting decision. You only go ahead if projected returns look attractive on a personal and financial basis.”...

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Q: “Risky projects are accepted for investment on the basis of favorable

“Risky projects are accepted for investment on the basis of favorable expectations concerning profitability. In the post-audit process, they must not be unfairly criticized for failing to meet those e...

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Q: What major steps are involved in the capital budgeting process?

What major steps are involved in the capital budgeting process?

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Q: OIBDA is an abbreviation for "operating income before depreciation and amortization

OIBDA is an abbreviation for "operating income before depreciation and amortization.” Like its predecessor EBITDA (“earnings before interest, taxes, depreciation and amortization”), OIBDA is used t...

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Q: Toyota Motor Corp., like most major multinational corporations, enjoys easy

Toyota Motor Corp., like most major multinational corporations, enjoys easy access to world financial markets. Explain why the NPV approach is the most appropriate tool for Toyota’s investment project...

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Q: Level 3 Communications, Inc., like many emerging telecom carriers,

Level 3 Communications, Inc., like many emerging telecom carriers, has only limited and infrequent access to domestic debt and equity markets. Explain the attractiveness of a “benefit-cost ratio” appr...

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Q: Critics argue that if Congress wants to make the tax code more

Critics argue that if Congress wants to make the tax code more equitable, a good place to start would be removing unfair tariffs and quotas. Today, there are more than eight thousand import tariffs, q...

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