Given that <span>Charles
loves watching downton abbey on his local public tv station, but he
never sends any money to support the station during its fundraising
drives.
Economists would call charles a free rider.
The
government can solve the problem caused by people like Charles by </span><span><span>privatize channels so viewers have to pay to view them.
</span>
The private market
can solve this problem by broadcasting downton abbey on cable tv, since
then the good would be excludable and thus no longer a public good.</span>
Answer:
$48.50
Explanation:
Relevant costs are the costs that are influenced by managerial decisions.They are future costs that have the tendency to affect the cash flow or outflow above the current level , that are relevant in making decisions . Examples are opportunity cost , incremental cost
The relevant cost in the scenario is the cost of buying from the supplier instead of in-house manufacturing , which is $48.50
Answer:
a. 1, 5 and 7
b. Resources will be allocated inefficiently
c. Differing sizes and capacities
d. Benefits due to economies of scale
e. Reduce prices and improve resource allocation.
Explanation:
The correct combination is 1, 5 and 7. The price of a pure monopoly firm is much higher than that of purely competitive firm because the later is a price taker while the former is a price fixer. Because of this, output of monopoly is lower while the profit margin is higher than that of competitive firm.
Assuming that a pure monopolist and a purely competitive firm have the same unit costs. In the case of a pure monopolist, resources will be allocated inefficiently because the monopolist does not produce at the point of minimum Average Total Cost and does not equate price and Marginal cost.
Even though both monopolists and competitive firms follow the MC = MR rule in maximizing profits, there are differences in the economic outcomes because pure competitors lack capacity and are smaller in size while the monopolist has the capacity to expand inorder to maximize profits.
The costs of a purely competitive firm and a monopoly may be different because the monopolist is capable of taking advantage of cost reduction arising from economics of scale. Pure competitors does not experience economies of scale due to their small sizes.
If a monopoly can experience economies of scale, it can reduce prices beyond that of the pure competitor thereby ensuring a more efficient resource allocation.
No. The percentage of pooped kernels depends on the quality of the kernel and the accuracy of the temperature indicated in the cooking instruction on the popcorn package.
