MCE604: Managerial Economics Assignment, AeU, Malaysia Mr. Rahim is planning to pursue MBA studies. Initial inquiry shows that he will have to pay RM 25,000 as a tuition fee

University Asia e University (AeU)
Subject MCE604: Managerial Economics

QUESTION 1

Mr. Rahim is planning to pursue MBA studies. Initial inquiry shows that he will have to pay RM 25,000 as a tuition fee, buy books for RM 1,000, and pay for transport for RM 1,000.

The MBA study program will extend over 15 months. Mr. Rahim is working now with a salary of RM 2,500 per month. Being a full-time student, he will have to forego the income from his present job for the period of study.

Work out: (a) the Financial cost, and (b) the Economic Cost of doing an MBA

QUESTION 2

A firm has the following revenue and cost functions.

TR = 90 Q – Q²

TC = 2Q²+ 30 Q

Determine the quantity level at which the firm maximizes its total profit.

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QUESTION 3

Explain the term price elasticity of demand. How is it measured? If the price elasticity is -3 and RM 200 is the marginal cost of product X, what should be the optimal sale price?

QUESTION 4

Explain price discrimination. What are the conditions to make price discrimination effective? Provide your answers with examples from the Airline Industry.

QUESTION 5

Briefly explain how firms compete/set prices under the Oligopoly market structure.

QUESTION 6

What is Inflation? Briefly discuss the various Fiscal and Monetary policies that are generally adopted to curb inflation

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