Define scarcity and opportunity cost. What role do these two concepts play in the making of
Scarcity is when supply is less than demand. Generally, people want more than can be supplied.
Major economic decisions have to be made when
In economics, it is often assumed that firm managers want to maximize the firms profits and that
consumers want to maximize utility. Why is this unlikely in the real world? What are some strategies
that firms can employ to keep customers engaged? What are
Chapter 6: problems 2, 5 (pg. 214-215)
Chapter 7: problems 1, 3 (pg. 285-286)
a) The diminishing marginal returns sets in at L = 8
b) The first stage is between L = 0 to 2, the second stage is between L = 2 to 8, and the third stage is
LP 5 Seminar Assessment
1. How are comparables used in the valuation of a firm?
Comparables help a company estimate the value of their company through estimation.
Using comparables allows the company to compare their company to other simil
LP 3 Seminar Danielle Huerta
Why is the relationship between cost and production mirror images of each other?
Cost and production mirror each other because the cost is used in determining the amount of
production needed. A companys productivity is the bas
Why is it important to seasonally adjust data?
It is important for companies to conduct seasonal adjustments because at different times
throughout the year, products/services are in higher demand than others. Conducting a seasonal
adjustment allows the co
The following function describes the demand condition for a company that makes caps featuring
names of college and professional teams in a variety of sports.
Where Q is cap sales and P is price.
A. How many caps could be sold at $12 each?
Explain why total revenue doesn't always increase when price is raised.
If cost of production increase due to raised prices, an increase in total revenue does not exist because
the company would be raising prices to cover increased production therefore ba
1. What are the two most common measures of risk, and how are they related to each other?
The variance and standard deviation are the two most common measures of risk. The
variance measure is used by calculating the squared deviation from the mean and the