Assignment 1
Unit: Production, Costs, and Perfect Competition
Assignment Description
Please use the following information and use it to complete a few calculations, and answer questions in your paper. The paper ought to be written as a brief (1-1.5 pages) report that includes your calculations and a short explanation of what the firm should do if it is making a loss.
A firm currently uses 40,000 workers to produce 100,000 units of output per day.
The daily wage per worker is $80, and the price of the firm's output is $41. The cost of other variable inputs is $400,000 per day. Assume that total fixed cost equals $900,000. (Note: Assume that output is constant at the level of 100,000 units per day.)
Calculate the values for the following variables using the formulas that are given:
• Total Variable Cost = (Number of Workers x Worker's Daily Wage) + Other Variable Costs
• Total Costs = Total Variable Costs + Total Fixed Costs
• Total Revenue = Price * Quantity
• Average Variable Cost = Total Variable Cost / Units of Output per Day
• Average Total Cost = (Total Variable Cost + Total Fixed Cost) / Units of Output per Day
• Profit/Loss = Total Revenue - Total Costs
Complete the following:
• Is the firm making a profit or a loss?
• Explain the Short Run Shut Down Rule. Should this firm shut down? Please explain.
Be sure to show your work. Include a reference list.
Assignment 2
Unit: Economic Policy and the Environment
Assignment Description
Sometimes market activities (production, buying, and selling) have unintended positive or negative effects outside the market's scope, like pollution. These are called externalities.
Assume that you are a policy maker concerned with correcting the effects of gases and particulates emitted by a local power plant. Write a 1-page memo that addresses the following points:
• Select 1 of the following policies from the following list that you think would best reduce emissions: Pigouvian taxes, emission taxes, or cap and trade. Explain it.
• Why do you think your policy would work in reducing the total amount of emissions?
• In your answer, explain the costs and the benefits of the production and consumption of the good, as well as the negative externality.
• How would you decide what the best or optimal level of emission reduction would be?
Format your answers as a memo with 1 page of written content. You may use bullet points, but please cite your sources. Include a reference list.
Assignment 3
Unit: Oligopoly, Monopolistic Competition, Monopoly, Mergers, and Acquisitions
Assignment Description
There have been several mergers of large firms within oligopolies. In this assignment, you are to select one merger of publically traded companies that has occurred in the last five years. You can find these by doing an internet search using the terms such as "recent mergers and acquisitions," or you may go to FTC.gov and review their recent cases and proceedings athttps://www.ftc.gov/enforcement.
• Write a paper that describes the principle firms, their industry, and that summarizes either the arguments in support of the merger or the arguments opposing the merger. The core of the paper should be approximately 2 pages in length, excluding the title page and bibliography.
• In addition to the 2 pages of content, include a title page, abstract, and bibliography.
Some Things to Consider: Industry Description
• Describe the firms in the proposed merger. List their annual sales, and extent of their operations. It would help to include sales of the top four firms.
• From the firms' point of view, what are some of the incentives to consolidate?
• Describe the competitive environment within the industry.
Some Things to Consider: Summaries
• Explain whether the competitive environment in this industry benefits society or not.
• Does the merger increase market concentration?
• Is a high degree of market concentration a boon or threat to consumers? Explain.
• How would the merger benefit the firms?
• How does the merger benefit society? Explain.
• Is this merger damaging to society? Explain.
You might use one or more of the following concepts: productive efficiency, administrative efficiency, or dynamic efficiency.
Please submit your assignment.
Your assignment will be graded in accordance with the following criteria. Click here to view the grading rubric.
For assistance with your assignment, please use your text, Web resources, and all course materials.