Questions from Managerial Economics

Q: In the game-theoretic model of workouts and rollovers (Figure

In the game-theoretic model of workouts and rollovers (Figure 15.2), identify the specific consequences of loan terms that worsen the moral hazard problem. Data from figure 15.2:

Q: If coal mine tonnage can be shipped elsewhere cheaply, but an

If coal mine tonnage can be shipped elsewhere cheaply, but an adjacent coal-fired power plant is not redeployable to other uses, what organizational form would be adopted by the power plant owners? Wh...

Q: Would warehouse operators insist on owning their own trucking companies? Why

Would warehouse operators insist on owning their own trucking companies? Why or why not? What coordination and control problems and contractual hazards would these companies encounter?

Q: If Apple iPod only played iTunes, and iTunes only could be

If Apple iPod only played iTunes, and iTunes only could be heard on the Apple iPod, could Apple price the technologically integrated bundle any way it wanted? If other electronic music can play on an...

Q: The Williams Company has a present capital structure (that it considers

The Williams Company has a present capital structure (that it considers optimal) consisting of 30 percent long-term debt and 70 percent common equity. The company plans to finance next year’s capital...

Q: Specific Electric Co. asks you to implement a pay-for

Specific Electric Co. asks you to implement a pay-for-performance incentive contract for its new CEO and four EVPs on the Executive Committee. The five managers can either work really hard with 70 hou...

Q: Airlines face highly cyclical demand; American reported profitability in the strong

Airlines face highly cyclical demand; American reported profitability in the strong expansion of 2006–2007 but massive losses in the severe recession of 2008–2009. Demand also fluctuates day to day. O...

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: Given the following market share distributions, the U.S.

Given the following market share distributions, the U.S. Antitrust Division blocked a merger of BMG and EMI in 2001, and the European Commission blocked a merger of Time Warner’s mus...

Q: Explore the crisis that Internet file sharing of copyrighted music recordings has

Explore the crisis that Internet file sharing of copyrighted music recordings has caused for Vivendi Universal, Sony Music, EMI, and AOL Time Warner Music, which together formerly supplied 70 percent...