Twin Cities Seed (TCS) Company and River Valley Seed (RVS) C…

Twin Cities Seed (TCS) Company and River Valley Seed (RVS) Company produce and process seeds for agricultural use. Both companies are considering expanding their production facilities in 2026 to increase their profitability. Firms may choose either a large expansion to capacity, a small expansion, or no expansion. Suppose that both firms have perfect information about all payoffs and must choose their strategy  simultaneously. The table below plots the present value of payoffs (in $ millions) for TCS and RVS based on the potential decisions by either firm. The payoff for TCS is first to appear in the cell, RVS is the second: (TCS,RVS). For example, if TCS chooses a large expansion and RVS chooses no expansion, TCS will net $19 million and RVS will net $10 million. Based on the information provided, what do you expect to happen and why?       RVS Capacity Expansion     No Expansion Small Expansion Large Expansion TCS Capacity Expansion No Expansion 30, 30 15, 33 10, 19 Small Expansion 33, 15 24, 24 9, 15 Large Expansion 19, 10 15, 9 3, 3

You work for a large agrochemical manufacturer producing atr…

You work for a large agrochemical manufacturer producing atrazine and glyphosate. a) For glyphosate, marginal costs are constant and positive (MC>0). Analysts report that at the current price, the price elasticity of demand is ​εp,q=−0.75. An executive suggests cutting the price until elasticity reaches -1 to maximize profits. Do you agree with this recommendation? Explain why or why not. b) For atrazine, the firm produces 100,000 kg/year. Marginal cost is constant at MC=$4/kg, and average cost at current output is AC=$9/kg. The current price is P=$10/kg, and the price elasticity of demand is estimated to be constant at εp,q=−2. Should your firm change the price of atrazine or keep the price at $10 per kilogram? Why?

You have been reviewing your client’s description of its int…

You have been reviewing your client’s description of its internal controls and you notice that the following preventative controls are in place: requiring manager approval for inventory write-offs; and  segregation of duties so that employees executing sales do not perform inventory write-offs. As part of a fraud risk assessment, which of the following choices correctly identifies the fraud scheme(s) these internal controls would help prevent? (Check all that apply)  

Potentially Useful Formulas: 1. Price elasticity of demand:…

Potentially Useful Formulas: 1. Price elasticity of demand: εp,q = (ΔQ/ΔP)(P/Q) 2. Income elasticity of demand : εi,q = (ΔQ/ΔI)(I/Q) 3. Profit maximization for a competitive firm: choose Q such that P = MC (MC: Marginal Cost) 4. Profit maximization more generally: choose Q such that MR(Q) = MC(Q) 5. Total costs = Fixed Costs + Variable costs (TC = FC + VC) 6. AC = TC/Q (AC: Average Cost, TC: Total Cost) 7. Pricing rule of thumb: (P-MC)/P = -1/ εp,q (Where P=Price, Q=Quantity, I=Income, MC=Marginal Cost, MR=Marginal Revenue, TC=Total Cost, FC=Fixed Cost, VC=Variable Cost, AC=Average Cost, εp,q​=Price Elasticity of Demand, εi,q=Income Elasticity of Demand)