Scenario 1 (length: as ne

Scenario 1 (length: as ne

Scenario 1 (length: as needed)A cupcake store is located in a mall and is the only cupcake store in that mall. The demand schedule for cupcakes (per dozen) is given in the table below. If the marginal cost to produce a dozen cupcakes is $4 per unit, how many units should the firm produce?1. What price should the cupcake store charge?2. If the fixed cost for the firm is $100 per day, how much profit will the firm make in one day?3. On page 70, what is the answer choice letter for the individual problem six involving Christine’s purchase?4. On page 71, what is the answer choice letter for the individual problem eight involving consumer surplus?Scenario 2 (length: as needed)Problem One: As the price of video games is raised from $40 to $45, their quantity demanded fell from 1.5 million copies to 1.2 million copies. The correct answer is negative so do not perform the last step of taking the absolute value of what you compute for the elasticity of demand. The elasticity of demand of video games is (select the answer closest to what you calculate): [a] – 0.25 [b] – 1.8 [c] – 2.08Problem Two: Jim saw a decrease in the quantity demanded for his firm’s product from 8000 to 6000 units a week when he raised the price of the product from $200 to $250. The correct answer is negative so do not perform the last step of taking the absolute value of what you compute for the elasticity of demand. What is Jim’s own price elasticity of demand (select the answer closest to what you calculate)[a] – 1.[b] – 1[c] – 0.25Problem Three: On page 99, what is the answer choice letter for the individual problem two involving changes in supply and demand?Problem Four: On page 99, what is the answer choice letter for the individual problem ten involving a decrease in the tax for producing coffee?Scenario 3 (length: as needed)In “Kitchen Nightmares,” Chef Gordon Ramsay visits struggling restaurants and gives the owners of the restaurant a number of recommendations intended to reverse the restaurant’s prospects. One suggestion Chef Ramsay commonly makes is to reduce the size of the restaurant’s menu and concentrate on a smaller number of offerings. Our textbook has several theories that can be used to explain how that recommendation can reduce costs.1. The above recommendation can involves an application of Diseconomies of Scope (answer True or False).2. The above recommendation can involve use of the Learning Curve concept to suggest a smaller menu would lead to a cost reduction (answer True or False).Scenario 4 (length: as needed)Consider the market for corn in the United States. Suppose that the mandated percentage of ethanol in gasoline is increased and at the same time a corn blight destroys a significant portion of the corn crop. If you were to use a supply and demand diagram to show this situation and what happens to the equilibrium quantity and the price of corn in the United States, the diagram could be similar to Figure 8.5 on page 91 (consider the diagram without the numerical values). Answer with either a True or False (select the best answer).Scenario 5 (length: one paragraph)Review the following resources:Website: S&P Case-Shiller 20-City Home Price Index (SPCS20RSA) http://research.stlouisfed.org/fred2/series/SPCS20RSA?cid=32261Website: New One Family Houses Sold: United States (HSN1F) http://research.stlouisfed.org/fred2/series/HSN1FDuring the housing crash in 2008, housing prices fell, and the number of new houses sold in the United States also fell. The link to New One Family Houses Sold does not include existing house sales, but assume that existing house sales fell as well. Answer the following question: The housing crash involved changes to the the determinants of demand and the determinants of supply that resulted in some of the changes and shifts to both the demand curve and the supply curve (answer either True or False, select the best answer)?

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