This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Lemonade anyone? II Raymond decides to set up a lemonade stand every weekend for the next four weeks ... (Read 56 times)

jessicacav

  • Hero Member
  • *****
  • Posts: 558
on: Jul 1, 2018
Lemonade anyone? II Raymond decides to set up a lemonade stand every weekend for the next four weeks to save up for the latest x-men comic. He has to pay his brother Robert 10 as a one time payment for him to not bully Raymond or drive his customers away. The lemons and sugar cost him 10 (the water is free) and his dad offers to set up his stall for him. He ends up making 15 his first weekend. Frank, his father notices this and advises Raymond to shutdown the stall, while Marie his mother advises him not only to set up the stall next weekend but to increase production even more. Raymond is extremely confused. Who do you think he should listen to?

Question 2

In which of the following cases does the Robinson-Patman act not apply?
 a. There are no cost differences to serving different groups
  b. Discounts are never offered to meet competition
 c. The industry does not engage in promotional allowances
  d. All of the above


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

tdewitt

  • Sr. Member
  • ****
  • Posts: 318
Reply #1 on: Jul 1, 2018
Answer to Question 1

In this case, his mother is right, he is actually making a profit of 5, since the anti-bullying cost he paid to Robert is fixed and now unavoidable and should not be a part of the calculations. Therefore he should definitely not shut down. In this case the marginal revenue is also above his marginal cost, and thus if he increases production, his profit would increase and hence he should ramp up production.

Answer to Question 2

d


jessicacav

  • Member
  • Posts: 558
Reply 2 on: Jul 1, 2018
Gracias!

jamesnevil303

  • Member
  • Posts: 337
Reply 3 on: Yesterday
Excellent

« previous next »
 

Did you know?

Immunoglobulin injections may give short-term protection against, or reduce severity of certain diseases. They help people who have an inherited problem making their own antibodies, or those who are having certain types of cancer treatments.

Did you know?

Approximately one in four people diagnosed with diabetes will develop foot problems. Of these, about one-third will require lower extremity amputation.

Did you know?

As many as 28% of hospitalized patients requiring mechanical ventilators to help them breathe (for more than 48 hours) will develop ventilator-associated pneumonia. Current therapy involves intravenous antibiotics, but new antibiotics that can be inhaled (and more directly treat the infection) are being developed.

Did you know?

Hip fractures are the most serious consequences of osteoporosis. The incidence of hip fractures increases with each decade among patients in their 60s to patients in their 90s for both women and men of all populations. Men and women older than 80 years of age show the highest incidence of hip fractures.

Did you know?

Certain rare plants containing cyanide include apricot pits and a type of potato called cassava. Fortunately, only chronic or massive ingestion of any of these plants can lead to serious poisoning.

36 weeks in the uterus 36 weeks in the uterus
Kenneth Raymond Miller Kenneth Raymond Miller
Stretch anterior tissues by pressing down on shoulders. Stand at the head of the table. Place the ... Stretch anterior tissues by pressing down on shoulders. Stand at the head of the table. Place the ...
Postural changes with pregnancy in 28 weeks Postural changes with pregnancy in 28 weeks
Postural changes with pregnancy in 36 weeks Postural changes with pregnancy in 36 weeks
Video: Gastroesophageal Reflux Disease (GERD)

For a complete list of videos, visit our video library