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The Wrong Remedy Faced With A Housing Crisis Grad School Essay Help

The Wrong Remedy Faced with a housing crisis, California could further restrict supply 
 Rent control sounds appealing but is counter- productive

Economist May 10th 2018 “THE rent is too damn high,” read the signs brandished by tenant advocates at rallies held in late April in Oakland (median monthly rent: $2,950), Los Angeles (median monthly rent: $2,700), and Sacramento (median monthly rent: $1,895). The activists gathered, along with local politicians, to announce that they had collected the signatures necessary to include a proposal on California’s November ballot that would pave the way for cities to expand rent control. This, they feel, is the only way to mitigate the shortage of affordable housing in the state. The measure will seek to repeal the Costa Hawkins Rental Housing Act, a law passed in 1995 that places restrictions on local rent controls. It bars the 15 Californian cities that have them from introducing rent control in buildings constructed after 1995, and freezes previous municipal rent-control ordinances in place. In Los Angeles, this means that local leaders cannot mandate rent control in any building completed after October 1978. The law also regulates how much landlords can increase rent between tenants, and bans rent control on single-family homes. California’s

legislators tried and failed to repeal Costa Hawkins earlier this year. The renewed push for an expansion of rent control comes at a time of fierce debate over the future of California’s biggest cities, where housing is in short supply and rents have been rocketing. According to Trulia, a property- rental and sales platform, median rents in Oakland grew by 51% between 2012 and 2017; in San Francisco, they grew by 38% over the same period. Over half of California’s renters spend more than 30% of their income on shelter, according to the California Budget and Policy Centre, a research group. Instead of straining to cobble together rent, many Californians are trading palm trees for cheaper pastures in Texas, Arizona and Nevada. Others have been forced onto the streets. Homelessness in California rose by 14% between 2016 and 2017, according to the Department of Housing and Urban Development, a federal agency, compared with 1% nationally. Gloria Cortez, a mother of six, alleges she was recently evicted from her home in Pomona after complaining that mould was making her feel ill. She and her family cannot find another apartment they can afford, and now divide their sleep between hotels, cars and parks. Champions of expanded rent control argue that it will allow cities to protect and increase their stock of affordable housing. “We need tools to prevent price gouging,” says Elena Popp, executive director of the Eviction Defence Network, one of three groups leading the charge to repeal Costa Hawkins. “It’s insane that a developer can go in and buy a building


where the median rent is $1,100 and bump it up to $2,700 from one day to another.” Such stories are troubling, but rent control is likely to make California’s housing problems even worse. A team of economists at Stanford University recently studied a 1994 ballot initiative in San Francisco that brought in rent protections for small multi-family housing built before 1980. The policy inspired landlords affected by it to convert their units into condos or redevelop their buildings, reducing their supply of rental housing by 15% and pushing up rents by 5% across the city. Paul Habibi, a professor at the Anderson School of Management at the University of California, Los Angeles, who invests in a mix of rent-controlled and non-rent-controlled property in the city, also points out that rent control does not necessarily benefit those most in need. “It seems sort of perverse that you can end up with a banker making $400,000 in a rent-controlled unit, while a plumber is forced to pay market rates.” It would make more sense to build some houses. Data released by the California Department of Housing and Community Development in January suggest that 98% of the state’s cities are failing to approve the construction needed to keep pace with population growth. In Los Angeles, the main barrier is an antiquated zoning code that is heavily skewed towards single-family homes. In April California’s state legislature blocked a plan to abolish caps on building height in some places, which would have allowed developers to scrape the sky. The Golden State is thus likely to respond to its shortfall by restricting housing supply even more. No polling has yet been done on the movement to repeal the restrictions on rent control, but a survey conducted by the Institute of Governmental Studies at the University of California, Berkeley, of registered Californian

voters in 2017 found that 60% of those polled supported rent control. Just 26% opposed it.

Competition Is for Losers Essay compare and contrast essay help: compare and contrast essay help

Competition Is for Losers If you want to create and capture lasting value, look to build a monopoly, writes Peter Thiel

! Only one thing can allow a business to transcend the daily brute struggle for survival: monopoly profits. JAVIER JAÉN By PETER THIEL Sept. 12, 2014 WSJ What valuable company is nobody building? This question is harder than it looks, because your company could create a lot of value without becoming very valuable itself. Creating value isn’t enough—you also need to capture some of the value you create. This means that even very big businesses can be bad businesses. For example, U.S. airline companies serve millions of passengers and create hundreds of billions of dollars of value each year. But in 2012, when the average airfare each way was $178, the airlines made only 37 cents per passenger trip. Compare them to Google , which creates less value but captures far more. Google brought in $50 billion in 2012 (versus $160 billion for the airlines), but it kept 21% of those revenues as

profits—more than 100 times the airline industry’s profit margin that year. Google makes so much money that it is now worth three times more than every U.S. airline combined. The airlines compete with each other, but Google stands alone. Economists use two simplified models to explain the difference: perfect competition and monopoly.

Monopolies are a good thing for society, venture capitalist Peter Thiel argues in an essay on WSJ. The PayPal co-founder joins Sara Murray to discuss his business philosophy, his take on Apple Pay, and what’s a deal breaker in pitch meetings. “Perfect competition” is considered both the ideal and the default state in Economics 101. So-called perfectly competitive markets achieve equilibrium when producer supply meets consumer demand. Every firm in a competitive market is undifferentiated and sells the same homogeneous products. Since no firm has any market power, they must all sell at whatever price the market determines. If there is money to be made, new firms will enter the market, increase supply, drive prices down and thereby eliminate the profits that attracted them in the first place. If too many firms enter the market, they’ll suffer losses, some will fold, and prices will rise back to sustainable levels. Under perfect competition, in the long run no company makes an economic profit. The opposite of perfect competition is monopoly. Whereas a competitive firm must sell at the market price, a monopoly owns its market, so it can set its own prices. Since it has no competition, it produces at the quantity and price combination that maximizes its profits. To an economist, every monopoly looks the same, whether it deviously eliminates rivals,


secures a license from the state or innovates its way to the top. I’m not interested in illegal bullies or government favorites: By “monopoly,” I mean the kind of company that is so good at what it does that no other firm can offer a close substitute. Google is a good example of a company that went from 0 to 1: It hasn’t competed in search since the early 2000s, when it definitively distanced itself from Microsoft and Yahoo! Americans mythologize competition and credit it with saving us from socialist bread lines. Actually, capitalism and competition are opposites. Capitalism is premised on the accumulation of capital, but under perfect competition, all profits get competed away. The lesson for entrepreneurs is clear: If you want to create and capture lasting value, don’t build an undifferentiated commodity business. How much of the world is actually monopolistic? How much is truly competitive? It is hard to say because our common conversation about these matters is so confused. To the outside observer, all businesses can seem reasonably alike, so it is easy to perceive only small differences between them. But the reality is much more binary than that. There is an enormous difference between perfect competition and monopoly, and most businesses are much closer to one extreme than we commonly realize. The confusion comes from a universal bias for describing market conditions in self- serving ways: Both monopolists and competitors are incentivized to bend the truth. Monopolists lie to protect themselves. They know that bragging about their great monopoly invites being audited, scrutinized and attacked. Since they very much want their monopoly profits to continue unmolested, they tend to do whatever they can to conceal

their monopoly—usually by exaggerating the power of their (nonexistent) competition.

! Google makes so much money that it is now worth three times more than every U.S. airline combined. ASSOCIATED PRESS Think about how Google talks about its business. It certainly doesn’t claim to be a monopoly. But is it one? Well, it depends: a monopoly in what? Let’s say that Google is primarily a search engine. As of May 2014, it owns about 68% of the search market. (Its closest competitors, Microsoft and Yahoo! , have about 19% and 10%, respectively.) If that doesn’t seem dominant enough, consider the fact that the word “google” is now an official entry in the Oxford English Dictionary—as a verb. Don’t hold your breath waiting for that to happen to Bing. But suppose we say that Google is primarily an advertising company. That changes things. The U.S. search-engine advertising market is $17 billion annually. Online advertising is $37 billion annually. The entire U.S. advertising market is $150 billion. And global advertising is a $495 billion market. So even if Google completely monopolized U.S. search-engine advertising, it would own just 3.4% of the global advertising market. From this angle, Google looks like a small player in a competitive world. What if we frame Google as a multifaceted technology company instead? This seems reasonable enough; in addition to its search


engine, Google makes dozens of other software products, not to mention robotic cars, Android phones and wearable computers. But 95% of Google’s revenue comes from search advertising; its other products generated just $2.35 billion in 2012 and its consumer-tech products a mere fraction of that. Since consumer tech is a $964 billion market globally, Google owns less than 0.24% of it—a far cry from relevance, let alone monopoly. Framing itself as just another tech company allows Google to escape all sorts of unwanted attention. Non-monopolists tell the opposite lie: “We’re in a league of our own.” Entrepreneurs are always biased to understate the scale of competition, but that is the biggest mistake a startup can make. The fatal temptation is to describe your market extremely narrowly so that you dominate it by definition. Suppose you want to start a restaurant in Palo Alto that serves British food. “No one else is doing it,” you might reason. “We’ll own the entire market.” But that is only true if the relevant market is the market for British food specifically. What if the actual market is the Palo Alto restaurant market in general? And what if all the restaurants in nearby towns are part of the relevant market as well? These are hard questions, but the bigger problem is that you have an incentive not to ask them at all. When you hear that most new restaurants fail within one or two years, your instinct will be to come up with a story about how yours is different. You’ll spend time trying to convince people that you are exceptional instead of seriously considering whether that is true. It would be better to pause and consider whether there are people in Palo Alto who would rather eat British food above all else. They may well not exist. In 2001, my co-workers at PayPal and I would often get lunch on Castro Street in

Mountain View, Calif. We had our pick of restaurants, starting with obvious categories like Indian, sushi and burgers. There were more options once we settled on a type: North Indian or South Indian, cheaper or fancier, and so on. In contrast to the competitive local restaurant market, PayPal was then the only email-based payments company in the world. We employed fewer people than the restaurants on Castro Street did, but our business was much more valuable than all those restaurants combined. Starting a new South Indian restaurant is a really hard way to make money. If you lose sight of competitive reality and focus on trivial differentiating factors—maybe you think your naan is superior because of your great-grandmother’s recipe—your business is unlikely to survive. The problem with a competitive business goes beyond lack of profits. Imagine you’re running one of those restaurants in Mountain View. You’re not that different from dozens of your competitors, so you’ve got to fight hard to survive. If you offer affordable food with low margins, you can probably pay employees only minimum wage. And you’ll need to squeeze out every efficiency: That is why small restaurants put Grandma to work at the register and make the kids wash dishes in the back. A monopoly like Google is different. Since it doesn’t have to worry about competing with anyone, it has wider latitude to care about its workers, its products and its impact on the wider world. Google’s motto—”Don’t be evil”—is in part a branding ploy, but it is also characteristic of a kind of business that is successful enough to take ethics seriously without jeopardizing its own existence. In business, money is either an important thing or it is everything. Monopolists can afford to think about things other than making money; non-monopolists can’t. In perfect competition,



a business is so focused on today’s margins that it can’t possibly plan for a long-term future. Only one thing can allow a business to transcend the daily brute struggle for survival: monopoly profits. So a monopoly is good for everyone on the inside, but what about everyone on the outside? Do outsize profits come at the expense of the rest of society? Actually, yes: Profits come out of customers’ wallets, and monopolies deserve their bad reputation—but only in a world where nothing changes. In a static world, a monopolist is just a rent collector. If you corner the market for something, you can jack up the price; others will have no choice but to buy from you. Think of the famous board game: Deeds are shuffled around from player to player, but the board never changes. There is no way to win by inventing a better kind of real-estate development. The relative values of the properties are fixed for all time, so all you can do is try to buy them up. But the world we live in is dynamic: We can invent new and better things. Creative monopolists give customers more choices by adding entirely new categories of abundance to the world. Creative monopolies aren’t just good for the rest of society; they’re powerful engines for making it better. Even the government knows this: That is why one of its departments works hard to create monopolies (by granting patents to new inventions) even though another part hunts them down (by prosecuting antitrust cases). It is possible to question whether anyone should really be awarded a monopoly simply for having been the first to think of something like a mobile software design. But something like Apple ‘s monopoly profits from designing, producing and marketing the iPhone were clearly the reward for creating greater abundance, not artificial scarcity:

Customers were happy to finally have the choice of paying high prices to get a smartphone that actually works. The dynamism of new monopolies itself explains why old monopolies don’t strangle innovation. With Apple’s iOS at the forefront, the rise of mobile computing has dramatically reduced Microsoft’s decadeslong operating system dominance. Before that, IBM ‘s hardware monopoly of the 1960s and ’70s was overtaken by Microsoft’s software monopoly. AT&T had a monopoly on telephone service for most of the 20th century, but now anyone can get a cheap cellphone plan from any number of providers. If the tendency of monopoly businesses was to hold back progress, they would be dangerous, and we’d be right to oppose them. But the history of progress is a history of better monopoly businesses replacing incumbents. Monopolies drive progress because the promise of years or even decades of monopoly profits provides a powerful incentive to innovate. Then monopolies can keep innovating because profits enable them to make the long-term plans and finance the ambitious research projects that firms locked in competition can’t dream of. So why are economists obsessed with competition as an ideal state? It is a relic of history. Economists copied their mathematics from the work of 19th-century physicists: They see individuals and businesses as interchangeable atoms, not as unique creators. Their theories describe an equilibrium state of perfect competition because that is what’s easy to model, not because it represents the best of business. But the long-run equilibrium predicted by 19th-century physics was a state in which all energy is evenly distributed and everything comes to rest—also known as the heat death of the universe. Whatever your views on thermodynamics, it is a powerful


metaphor. In business, equilibrium means stasis, and stasis means death. If your industry is in a competitive equilibrium, the death of your business won’t matter to the world; some other undifferentiated competitor will always be ready to take your place. Perfect equilibrium may describe the void that is most of the universe. It may even characterize many businesses. But every new creation takes place far from equilibrium. In the real world outside economic theory, every business is successful exactly to the extent that it does something others cannot. Monopoly is therefore not a pathology or an exception. Monopoly is the condition of every successful business. Tolstoy famously opens “Anna Karenina” by observing: “All happy families are alike; each unhappy family is unhappy in its own way.” Business is the opposite. All happy companies are different: Each one earns a monopoly by solving a unique problem. All failed companies are the same: They failed to escape competition. Adapted from Mr. Thiel’s new book, with Blake Masters, “Zero to One: Notes on Startups, or How to Build the Future,” which will be published by Crown Business on Sept. 16. Mr. Thiel co-founded PayPal and Palantir and made the first outside investment in Facebook.

Wal-Mart Ratchets Up Pressure on Suppliers mba essay help

Wal-Mart Ratchets Up Pressure on Suppliers to Cut Prices Retailer urges them to pull back on joint- marketing efforts to bring cost down

! With the growth of dollar stores and other discounters, Wal-Mart is facing ever more competition on price, which for many customers is the most important selling point. PHOTO: JOE RAEDLE/GETTY IMAGES By PAUL ZIOBRO and SERENA NG March 31, 2015 WSJ Wal-Mart Stores Inc. is increasing the pressure on suppliers to cut the cost of their products, in an effort to regain the mantle of low-price leader and turn around its sluggish U.S. sales. The retailing behemoth says it has been telling suppliers to forgo investments in joint marketing with the retailer and plow the savings into lower prices instead. Makers of branded consumer products from diapers to yogurt typically earmark a portion of their budgets for marketing with Wal- Mart, spending on things like eye-catching product displays and online advertisements. Wal-Mart has long had a reputation for pressing its suppliers to cut costs to help lower prices, but the retailer’s new leadership has embraced the concept with fresh vigor. Wal-Mart’s price advantage against its competitors has been eroded, and it has steadily been losing market share in the U.S. since the recession ended, while rivals including Kroger Co. and Costco Wholesale Corp. gained share, according to data from the consultancy Kantar Retail. With the growth of dollar stores and other discounters, Wal-Mart is facing ever more competition on price, which for many customers is the most important selling point. The new dictate on prices is creating tension with companies that supply the hundreds of thousands of products on Wal-Mart’s shelves.

While lowering prices by shaving down marketing budgets may help Wal-Mart draw more customers, it gives suppliers less control over how their products are displayed or promoted, and less ability to make them stand out against store brands or other rivals. That is an issue when Wal- Mart and other chains are trumpeting their private-label house brands. The zeal on pricing is part of a push by new Chief Executive Doug McMillon and U.S. head Greg Foran to turn around Wal-Mart’s core domestic business, which booked $288 billion in sales in the year ended Jan. 31, 60% of the company’s total. While U.S. sales were up 3% last year, the growth was a scant 0.5% excluding newly opened stores, and the division’s profit fell. With the heavy investments related to its promise to raise wages and the development of a vast e- commerce business, Wal-Mart has fewer options for chipping away at costs, putting suppliers in the cross hairs. ‘They kept pushing, ‘We’re going back to basics, it’s all about low pricing.’’ —A supplier who attended February meeting Messrs. Foran and McMillon laid out the pricing message during a private meeting with suppliers in February. They want suppliers to operate with the same everyday low cost model that Wal-Mart employs from top to bottom. “They kept pushing, ‘We’re going back to basics, it’s all about low pricing,’ ” said one supplier who attended the meeting. Mr. Foran, who became president and CEO of Wal-Mart’s U.S. business in August after leading the Asia division, plans to address Wall Street analysts Wednesday to lay out in more detail his plans for the U.S. business. Financial arrangements between suppliers and big retailers aren’t just a matter of coming to terms on volumes and a wholesale price. They often also bundle in a host of extras including slotting fees, funds for special promotional discounts and money to pay for shared marketing. The latter is particularly important for makers of branded consumer goods. “We want to get back to a point where we are playing offense with price because of the way we go to market,” Mr. McMillon said, according to a transcript. “Our pricing strategy is aimed at one objective, and that is building trust.” The effort to get suppliers to reallocate the marketing investments reinforces the company’s long-standing business strategy to keep costs low, said Deisha Barnett, a Wal-Mart spokeswoman.


“It’s a proven business model that works,” she said. “We think the smart investment is to put the dollars into price.” Former Wal-Mart employee Derek Ridenoure now works at C.F. Sauer Co., a company that supplies the retailer with spices, seasoning mixes and other packaged food products. He said a team at Wal-Mart closely monitors commodity prices and asks suppliers to reduce costs when it observes downward trends in ingredients prices. After a long slide left soybean prices at a multiyear low recently, the retailer asked Mr. Ridenoure this year to cut his prices. Soybean oil is a key ingredient in many condiments made by C.F. Sauer.

! Wal-Mart’s U.S. division is in the early stages of a turnaround, having just posted two straight quarters of positive same-store sales after a long slump. Low gasoline prices have helped. PHOTO: JOE RAEDLE/GETTY IMAGES “I pushed back initially,” Mr. Ridenoure said, reasoning that soybean prices could march higher if farmers switched to other crops. Wal-Mart’s response was that if soybean prices marched higher, suppliers could take their prices up again. Mr. Ridenoure’s company ultimately agreed to cut costs by giving discounts for bigger orders. Recently, in what was widely seen as a move to pressure Procter & Gamble Co. to lower prices of its popular Tide detergent, Wal-Mart struck a deal with consumer products company Henkel AG to introduce a new premium-priced detergent brand, Persil, exclusively in its stores. Wal-Mart is selling Persil at the same price as Tide, and displaying it on shelves next to Tide. Ms. Barnett said Wal-Mart decided to start selling Persil in the U.S. to broaden the assortment in its laundry aisle. A P&G spokesman declined to comment about its relationship with Wal-Mart,

but said the company welcomes competition in the detergent business. Wal-Mart’s U.S. division is in the early stages of a turnaround, having just posted two straight quarters of positive same-store sales after a long slump. Executives at the retailer have attributed part of the increase to falling gasoline prices, which have led some shoppers to spend more and to make the longer drive to the stores. The gains are tenuous, however, and Mr. Foran has been meeting with former executives to understand what gave the retailer an edge during its heyday. The native New Zealander is a devotee of former Wal-Mart executive and board member Jack Shewmaker, who developed the company’s everyday-low- price strategy and died in 2010.

Superheroes riding a Marvelous wave essay help tips: essay help tips

Superheroes riding a Marvel-ous wave at the box office Scott Bowles and Brian Truitt, USA TODAY April 13, 2014

! There was a time, legend has it, when only two men seemed suited to police the planet. Or at least Hollywood’s world. Lantern-jawed, darkly handsome and fond of the American way of life, Superman and Batman had much in common despite hailing from different planets. Both were born in the 1930s, dominated theaters and television and even shared a New York mailing address: the headquarters of DC Comics. But in 2000, a new strain of hero — a mutant strain — entered the big-screen spandex fray. X-Men, about an academy for social outcasts with superpowers, collected an astounding $157 million at the box office, introduced an Aussie named Hugh Jackman and made the fledgling Marvel Studios a sudden player in comic-book movies. Just 14 years later, Marvel has taken on a new identity, as the industry’s most bankable studio for live-action hits. Its most recent film, Captain America: The Winter Soldier, nabbed a $95 million opening earlier this month, the largest debut in April ever, then claimed a second straight week at No. 1, collecting $159 million in just 10 days. Most of Marvel’s soldiers are warriors. Of the 33 movies featuring Marvel characters, each averaged $184 million domestically and $410 million worldwide. The Avengers collected $623 million domestically in 2012, the third- highest-grossing film ever. That success has been spread over more than a dozen characters and teams, from Spider-Man to Thor to the Fantastic Four. And with the exception of a couple of turkeys such as Elektra and The Punisher, Marvel’s unprecedented cross-promotional strategy of having superheroes do guest spots in each others’ movies has helped it claim seven of the 10 top-grossing comic-book flicks of all-time. In the process, Marvel has changed how Hollywood and moviegoers view comic-book films, which have morphed

from camp escapism to Oscar contention — and box-office domination. “We are in a post-book era,” says Wheeler Winston Dixon, a professor of film studies at the University of Nebraska in Lincoln, who teaches a course on comic-book movies.



“We don’t read books or magazines much, and newspapers are hanging on by a thread,” he says. “But people are connecting with these movies more than they used to. Characters have back stories. Spider-Man is concerned with the same issues as his target audience.” Super formula for success Marvel has come up with a strategy rooted in the three R’s of blockbuster-building: relatable characters, risky casting and really big budgets. The strategy: • Don’t skimp on the cash. Blade, Wesley Snipes’ film about a relatively obscure half-vampire, half-mortal, was

considered a pricey gamble at $45 million — until it collected $70 million. Marvel has never cut corners: The studio coughed up $170 million for Winter Soldier and $220 million for The Avengers.

The cash has been put to good use. “They have mastered 3-D for these movies,” Dixon says. Movies in 3-D “used to look like pop-up books. Now the depth is stunning.” • Go for actors, not action heroes. From Robert Downey Jr. as Iron Man to Jackman as X-Men’s Wolverine to

Robert Redford as Winter Soldier villain Alexander Pierce, Marvel has earned a reputation as a studio that can stun — and occasionally infuriate — comics devotees with star choices. But fans usually come around.

“Casting the movie is the most important thing — actors, directors, cinematographers,” says Marvel Studios president Kevin Feige. “It’s putting that team in place to bring the movie to life in a way it can be and should be. That’s always the hardest part. My anxiety level plummets when you get closer to the first day of shooting because we’re looking pretty good at that point.” • Even heroes need hang-ups. “If you look at what Marvel is doing, they’ve taken superheroes and made them

human,” says Anthony Mackie, who plays Sam Wilson, aka Falcon, in Winter Solder. He says Marvel has made its heroes, even those that fly or shoot webs, “relatable, given them a sense of dignity and pride that’s not so far off that you can’t relate to them.”

Mackie says the Marvel universe has many characters not simply waging battles of “good against evil, but fighting for the betterment of man. We can all relate to that.” Ultimate studio clash ahead? Competing studios are relating to the millions Marvel is raking in, and the competition for young dollars is fierce. Pixar Studios, which tends to draw younger kids, has the industry’s most impressive winning streak, with 14 straight No. 1 movies, averaging $253 million apiece. And DC Comics, whose stable includes Batman, Superman and The Justice League, is no slouch. Its heroes have appeared in 25 movies, averaging $133 million each. Analysts are salivating at the inevitable comics showdown. Already, the two are pitted against one another on May

6, 2016, when Captain America 3, distributed by Disney, is scheduled to open against the highly anticipated Batman vs. Superman, released by Warner Bros.

Neither studio is commenting on strategy, though neither has announced plans to blink. “You figure that someone will have to move, because they’ll cannibalize some business from each other,” says Jeff Bock, senior box-office analyst at Exhibitor Relations. “But it shows you how powerful this genre has become.” And with power comes a great many sequels. Marvel has on tap The Amazing Spider-Man 2 on May 2, X-Men Days of Future Past on May 23, and an Avengers sequel, Age of Ultron, due May 1, 2015. The studio also plans to launch a new superhero team franchise with Guardians of the Galaxy, out Aug. 1. While experts don’t expect the tide of superhero films to fade, the movies could follow a path similar to that of the comic books. Analysts expect a few developments: • Heroes who die. Comic-book heroes die all the time and are brought back to life. “Killing off a hero is completely

possible,” says Caleb Williams, editor-in-chief and founder of the website Superhero Movie News. “Marvel is not afraid to take risks.”

• Spider-Man against The Hulk? The Batman vs. Superman project and The Avengers may be the start of crossover films if studios can negotiate rights. “Who says X-Men can’t fight Avengers?” Bock says. “With this much money at stake, you know the brain trust is trying to figure a way.”

• Oscar-worthy films. Heath Ledger already won the first acting Oscar for a comic-book role, as the Joker in the 2008 Batman movie, The Dark Knight. Could a best picture be far off?

“These have become the classic myths of our times,” Dixon says. “They’re bigger than the comic books themselves. They are the future.”

Problem solving Using the Marginal Approach admission essay help

WEEK 5 PROBLEM SET Due week 5 and worth 200 points. You will submit your answers in a Blackboard assessment filling out charts and answering the essays/short answer questions. Note: There is not an option to upload your assignment, you must use the Blackboard assessment; however, you will be able to copy and paste your answers from a Word document.

Problem 1: Using the Marginal Approach Suppose your company runs a shuttle business of a hotel to and from the local airport. The costs for different customer loads are: 1 customer: $30 2 customers: $32 3 customers: $35 4 customers: $38 5 customers: $42 6 customers: $48 7 customers: $57 8 customers: $68.

1. What are your marginal costs for each customer load level? (Chart) 2. If you are compensated $10 per ride, what customer load would you choose? (Essay)

Problem 2: Elasticity and Pricing Suppose the number of firms you compete with has recently increased. You estimated that as a result of the increased competition, the demand elasticity has increased from –2 to –3, i.e., you face more elastic demand. You are currently charging $10 for your product. What is the price that you should charge, if demand elasticity is -3? (Essay)

Problem 3: Price Discrimination An amusement park, whose customer set is made up of two markets, adults and children, has developed demand schedules as follows:

Price ($)


Adults Children

5 15 20

6 14 18

7 13 16

8 12 14

9 11 12

10 10 10

11 9 8

12 8 6

13 7 4

14 6 2

The marginal operating cost of each unit of quantity is $5. Because marginal cost is a constant, so is average variable cost. Ignore fixed costs. The owners of the amusement part want to maximize profits. Calculate the price, quantity, and profit if:

1. The amusement park charges a different price for adults. (Chart) 2. The amusement park charges a different price for children. (Chart) 3. The amusement park charges the same price in the two markets combined. (Chart) 4. Explain the difference in the profit realized under the two situations. (Essay)

Problem 4: Bundling Time Warner could offer the History Channel (H) and Showtime (S) individually or as a bundle of both. Suppose the reservation prices of customers 1 and 2 (the highest prices they are willing to pay) are presented in the boxes below. The cost to Time Warner is $1 per customer for licensing fees. Preferences

Showtime History Chanel

Customer 1 9 2

Customer 2 3 8

1. Should Time Warner bundle or sell separately? (Essay) 2. Should Time Warner bundle if everyone likes Showtime more than the History Channel, i.e.,

preferences are positively correlated. (Essay) 3. Suppose Time Warner could sell Showtime for $9, and History channel for $8, while making

Showtime-History bundle available for $13. Should it use mixed bundling. i.e., sells products both separately and as a bundle? (Essay)

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