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The demand function for Multipurpose Double-Sided Magic pan is given as
QM: Quantity of Magic Pan demanded
PM: Price per unit of Magic Pan
PT: Price per unit of another brand of pan
Y: Income level per household
A: Advertising expenditure
In the demand equation, coefficient of income has a positive sign. The microeconomic theory of demand suggests that for a normal good, an increase in income leads to an increases in de...
Problem identification and recognition
This is the initial stage of decision making process, problem acknowledgement is well-defined as the aspiration to overcome some particular issues in a person’s life. One person need to explain the necessity of some exact choice of purchasing new goods and services for improvement of their life (Brander & Perloff, 2018).
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The second part of elements of dec...
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We decide which one has higher risk by computing the coefficient of variation as formulated: V= σ/r; where V is the coefficient of variation, σ is the ratio of standard deviation and r is the expected value.
For project A we have: VA= RM40000/RM50000 = 0.8
Since VA>VB, we conclude that project A has a higher risk with a higher coefficient of variation.
A) The price elastici...
In a market system where producers cooperate in creating individual and aggregate output levels and prices, it is called a cartel. In the case of a perfect cartel type, the output and price of the whole industry as well as each member firm is determined by a common authority which allows the achievement of joint profits for the individual firms. The resultant profit is distributed in a way which is pre-decided. Each firm’s shar...
QUESTION 1 (CLO 1)In a free enterprise system, economic profits play an important role in guiding the decisions made by the thousands of competing independent resource owners. a. Explain what is economic profit. Provide an example to support your answersb. Why do different resource owners obtain different profits, even when operating...
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