Yahoo Margin

Yahoo Margin - Name: Bao Dang ID: 16-867-4989 Yahoo Profit...

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Name: Bao Dang ID: 16-867-4989 Yahoo Profit Rises, but Revenue Falls According to Wall Street Journal on January 26, Yahoo Inc. made its second round of layoffs in two months. Disregard of the concern over Yahoo’s future growth and decreasing of its stock price when the company cut its cost by slashing 4% of its payroll and cutting 1% of its staff, interestingly, Yahoo’s quarterly profit increased more than double even though its revenue declined by 12%. The increasing in profit of Yahoo by cutting cost can be explained by using marginal analysis. Because Yahoo’s revenue declined when Yahoo cut its number of staff by 1%, or about 135 employees, each employee’s work must contribute an amount of money to the total revenue. Yahoo’s total revenue is the total benefit of hiring employees. Having an additional employee will increase the total revenue of the company because more works can be done and more advertising products can be sold. The amount of money contributed by an additional employee is
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This note was uploaded on 10/16/2011 for the course ECON 110 taught by Professor Vernon during the Fall '07 term at BYU.

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Yahoo Margin - Name: Bao Dang ID: 16-867-4989 Yahoo Profit...

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