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

Assignmentyou are the director of safety and health at

Assignment You are the Director of Safety and Health at Rotorcraft America, a mid-sized company that designs, manufactures and sells helicopters. Your organization has manufacturing operations in San Francisco, Californi ...

1 the crr model european claimconsider the crr model of

1. The CRR model: European claim. Consider the CRR model of stock price S with T periods and parameters d (a) Consider the European claim X with expiry date T and the payoff X = g(S r ) = 1/S T 1[k,∞)(S T ). Show that th ...

Questionsexercisesseminar 11nbsp discuss what you

Questions/Exercises Seminar 1 1.  Discuss what you understand by the following: a) the law of demand b) the conditions of demand c) a demand curve d) a normal good e) an inferior good f) a Giffen good G) the law of suppl ...

Assignment emerging economies and Assignment: Emerging Economies and Globalization

Assignment: Emerging Economies and Globalization Background Markets in developed economies are approaching saturation level. Therefore, MNCs are searching for new untapped markets in emerging countries such as India and ...

Desserts by jb case studyjay brown jb to his friends is a

Desserts by J.B Case Study Jay Brown (J.B. to his friends) is a student at the North-west Culinary Institute and specializes in preparing elab-orate desserts. After graduation. J.B. wants to open up a bakery. The bakery. ...

Assignment money and pricethe organizations strategic plan

Assignment: Money and Price The organization's strategic plan you wrote about calls for an aggressive growth plan, requiring investment in facilities and equipment, growth in productivity, and labor over the next five ye ...

Question 1which of the following has not been identified as

Question 1 Which of the following has NOT been identified as a basic consumer right? Consumers have a right to safe products. Consumers have a right to collude. Consumers have a right to be informed about a product. Cons ...

Assignmentin this assignment you must break a norm this

Assignment In this assignment, you must break a norm. This breach must be done in a public forum. You will be writing an essay about your experiment, in which you must be sure to answer all of the questions listed in thi ...

Discussion questionconsider a group of documents that has

Discussion Question Consider a group of documents that has been selected from a much larger set of diverse documents so that the selected documents are as dissimilar from one another as possible. If we consider documents ...

Intermediate microeconomics assignmentexercise 1 -

INTERMEDIATE MICROECONOMICS ASSIGNMENT Exercise 1 - Capturing surplus using a block pricing Consider a monopolist facing a linear demand p(q) = 20 - q, and marginal cost MC = 2. a) If the monopolist charges the same pric ...

  • 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

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro