Business, 17.12.2019 19:31 blakemccain1928
Tobacco companies have often argued that they advertise to attract more people who already smoke and not to persuade more people to begin smoking. suppose there were just two cigarette manufacturers, jones and smith. each can either advertise or not advertise. if neither advertises, they each capture 50 percent of the market and each earns $10 million. if they both advertise, they again split the market evenly, but each spends $2 million on ads and so each earns just $8 million (remember, advertising is not supposed to encourage more people to smoke). if one company advertises but the other does not, then the company that advertises attracts many of its rival’s customers. as a result, the company that advertises earns $12 million and the company that does not earns just $6 million.
a. show that advertising is a dominant strategy.
b. suppose the government proposes a ban on cigarette ads. should the two cigarette companies favor the ban or should they oppose the ban if advertising did not persuade some people to become smokers?
Answers: 2
Business, 22.06.2019 07:40
(a) what was the opportunity cost of non-gm food for many buyers before 2008? (b) why did they prefer the alternative? (c) what was the opportunity cost in 2008? (d) why did it change?
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Business, 22.06.2019 23:20
Assume a competitive firm faces a market price of $60, a cost curve of c = 0.003q^3 + 25q + 750, and a marginal cost of curve of: mc = 0.009q^2 + 25.the firm's profit maximizing output level (to the nearest tenth) is , and the profit (to the nearest penny) at this output level is $ will cause the market supply to (shift right/shift left). this will continue until the price is equal to the minimum average cost of $
Answers: 2
Business, 23.06.2019 02:40
Telecom co. enters into a two-year contract with a customer to provide wireless service (voice and data) for $40 per month. to induce customers, telecom co. provides a free phone. telecom co. normally sells the phone on a stand-alone basis for $200. telecom co. also charges the customer a one-time activation fee of $35.which of the following is true? a) there are two distinct performance obligations: the voice service and the data service b) the free phone constitutes as a marketing expense c) the activation fee is a separate performance obligationd) there are two distinct performance obligations: the wireless services and the phone
Answers: 2
Tobacco companies have often argued that they advertise to attract more people who already smoke and...
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