Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Microeconomics Expert

Q1. Essence of case is that in early 1986 a group of British publishers started charging higher prices for their journals in U.S. than in the U.K.. There was not uniform mark-up, and this is not what we would expect. Assume investigation reveals following data regarding relationship between prices for this journal and U.K. and U.S. sales:

Price per Subscription
U.K. Subscriptions
U.S. Subscriptions
$50.00
500
5500
$60.00
400
5000

Furthermore, assume the MC = $20/year whether subscription is sent to U.S. or the U.K., while [fixed] costs of soliciting, editing, and typesetting articles for journal come to $260,000 annually.

a. Using these data, sketch and label the linear U.K. and U.S. demand curves.

b. Compute profit-maximizing price and quantity of subscriptions for U.K. Compute profit-maximizing price and quantity of subscriptions for US. Indicate each on the suitable graph.

c. What are the total profits to Royal Economic Society annually from sale of the journal at these prices?

d. If Royal Economic Society were forced to charge same price to all subscribers, profit maximizing price per subscription would be $85.00. [Take my word for it.] If this is best single price that R.E.S. can get for its journal, what level of output must the R.E.S. plan for next year? What are profits? Describe.

e. Would elimination of differential pricing leave journal readers better or worse off in this case? Describe.

Microeconomics, Economics

  • Category:- Microeconomics
  • Reference No.:- M923197

Have any Question? 


Related Questions in Microeconomics

Organizational structures please respond to the following

Organizational Structures" Please respond to the following: FOR pro jamila • Watch the video "How to align the organizational structure with the work processes," found at http://www.organizationdesign.net/how-to-align-th ...

Problem set 11 the table below contains typical economic

Problem Set 1 1. The table below contains typical economic data. It show the quantity of a good that is demanded by purchasers and the quantity supplied by producers at various prices. At which price are quantities deman ...

Microeconomichow would a low-cost price leader enforce its

Microeconomic How would a low-cost price leader enforce its leadership through implied threats to a rival? How does a firm become a "low cost" price leader? Discuss the specific type of market structure that implied thre ...

Assignmentthe soft drink and juice beverage industry is

Assignment The soft drink and juice beverage industry is very competitive with more companies entering the market each year. This week our case study is the Dr Pepper Snapple Group, a major player in the industry. Your a ...

Short-run economic fluctuationscreate a 3 -slide microsoft

Short-Run Economic Fluctuations Create a 3 -slide Microsoft PowerPoint presentation that will be presented to the organization's Executive Committee. The presentation should cover the following items: • Identify the thre ...

Discussion questionsummationplease respond to the

Discussion Question Summation Please respond to the following: • Reflecting back on everything you have learned in this course, discuss the single most important lesson any entrepreneur should apply in order to be succes ...

Assessmentanswer all questions each is worth 15 marks for

ASSESSMENT: Answer all questions, each is worth 1.5 marks. For detailed assessment criteria see the subject guide, which also explains that the assessment looks at the quality of your answers, not the quantity. You can b ...

Milestone guidelinesthe purpose of this milestone is for

Milestone Guidelines The purpose of this milestone is for students to explore the various costs their firm faces and to describe their firm's market. Using the concepts and tools developed in Modules Four and Five, stude ...

Problem 1 given the following total revenue tr and total

Problem 1: Given the following total revenue (TR) and total cost (TC) functions, find the quantity of output (Q) that would maximize profit (π). Note that profit function is: π = TR - TC. TR = 1400Q - 7.5Q2 TC = Q3 - 6Q2 ...

Supply and demand draw curvea define economicsb what do we

Supply and Demand Draw Curve A: Define Economics B: What do we mean by "Scarcity" and how does that relate to the concept of "Opportunity Cost"? C: Distinguish between :macroeconomics" and :microeconomics" D: Distinguish ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

A cola-dispensing machine is set to dispense 9 ounces of

A cola-dispensing machine is set to dispense 9 ounces of cola per cup, with a standard deviation of 1.0 ounce. The manuf

What is marketingbullwhat is marketing think back to your

What is Marketing? • "What is marketing"? Think back to your impressions before you started this class versus how you

Question -your client david smith runs a small it

QUESTION - Your client, David Smith runs a small IT consulting business specialising in computer software and techno

Inspection of a random sample of 22 aircraft showed that 15

Inspection of a random sample of 22 aircraft showed that 15 needed repairs to fix a wiring problem that might compromise

Effective hrmquestionhow can an effective hrm system help

Effective HRM Question How can an effective HRM system help facilitate the achievement of an organization's strate