Question;you are starting your own Internet business. You decide to form a company that will sell cookbooks online. Justcookbooks.com is scheduled to launch 6 months from today. You estimate that the annual cost of this business will be as follows;Technology (Web design and maintenance);$5,000;Postage and handling;$1,000;Miscellaneous;$3,000;Inventory of cook books;$2,000;Equipment;$4,000;Overhead;$1,000;Part I;Deliverable Length: 1 paragraph plus calculations;You must give up your full-time job, which paid $50,000 per year, and you worked part-time for half of the year.;The average retail price of the cookbook will be $30, and the average cost will be $20.;Assume that the equation for demand is Q = 10,000 ? 9,000P, where;Q = the number of cookbooks sold per month;P = the retail price of books.;Show what the demand curve would look like if you sold the books between $25 and $35.;Part II;Deliverable Length: 1,000?1,500 words;Address the following questions;What is the elasticity of the demand for cookbooks bought this way?;Is the business worth pursuing so far?;Why or why not?;Suppose that you expect to sell about 22,000 cookbooks per month online, and assume that your overhead, technology, and equipment costs are fixed. What are your total costs?;What are your marginal costs?;What are the implications of operating in the short run and the long run?;As your business grows, how must you consider the issues regarding diminishing marginal returns and economies of scale?;What market structure have you entered, and why?;What can you do to guarantee success in this market?;Can you use price discrimination in this business?;What pricing strategy are you thinking about?;Part III;Deliverable Length: 600?800 words;The government decides to tax cookbooks because they feel that they encourage overeating and can lead to health issues, such as obesity and heart disease. Answer the following;What type of tax is this? Explain.;What happens to the supply of cookbooks?;What happens to the equilibrium price?;Who pays the tax at the end?;Is this a good way to finance programs to improve health?;What other types of tax can the government use to increase revenues?;Part IV;Deliverable Length: 600?850 words;Justcookbooks.com becomes wildly successful in the United States, and you decide to export overseas. Answer the following;Does this reflect an absolute or a comparative advantage?;Name 4 issues that you will encounter as you become a multinational corporation.;What happens to your marginal utility as you buy your third luxury automobile? Why?;Part V;Deliverable Length: 600?850 words;In the article entitled "The Economic Effects of Labor Unions Revisited," Vedder and Galloway attempt to prove statistically, using historical data, that labor unions do not have a good effect on the economy. Read the article, and explain the following microeconomic concepts that the authors discuss and how they are related to unions;Demand, supply, and equilibrium wage rates of labor;Unemployment;Deadweight welfare loss;Elasticity;Real GDP and economic growth;Income per capita;Population growth and aging;Marginal costs, marginal revenues, and profits;The article focuses on harmful economic effects, but also mentions some positive aspects. What are they? Does moral hazard apply to unions? Why or why not?
Paper#57725 | Written in 18-Jul-2015Price : $37