1. What model of profit maximization is applicable to the activities of a multinational company? Explain

2. The Transportation Authority in Anytown, USA, raised bus fares from $1 to $1.15 on January 1, 2002. The authority’s statistics show that the number of passengers riding buses decreased from 672,000 in 2001 to 623,000 in 2002.

a. How much did revenue change?

b. What is the arc elasticity for bus travel in Anytown?

c. The answer to b would be correct if all conditions (except price) remained the same between 2001 and 2002. Can you think of any other changes that would have affected the result?

3. There will be some difference in the set of variables used in the regression model of demand for consumer durables (cars, appliances, furniture) and a regression model of the demand for "goods FMCG" (meals, drinks , personal care products)? Explain.

4. Design a production study function for a steel manufacturer company and one for a focus of phone calls. What variables would use and what statistical method would select each function? In general, compare and contrast the production function for product and service.

5. How “perfectly” competitive do you think are the following markets: 1) stock market, 2) bond market, 3) foreign exchange market, 4) world sugar market, and 5) world oil market? Explain