When using the free-cash flow model, cash flows are discounted at the weighted average cost of capital (WACC) and when using the dividend discount model, dividends are discounted at….
Wk1 Michael Smith
A doctoral student has just completed a study for her dissertation and found the following demand and supply schedules for hand held computers to be as follows:
(the chart is attached)
Using Microsoft Excel, draw a graph illustrating the supply and demand in this market.
What is the equilibrium Price and Quantity in the market?
Now suppose the government imposes a special tax on these computers. Describe what would happen in this market in terms of the supply and demand curve.
Disregard the new tax in part three. Now assume that the government imposes a price ceiling of $100 in this market, as a result of protests of price gouging by the sellers. What would happen to the price and quantity in this market?
Disregard the events of part four. Assume that the manufacturers of this product lobby the government’s lawmakers, in terms of this product being an essential for college students but they are considering halting production due to the lack of profits. The lawmakers agree and now set a price floor at $150. What would happen in this market?
If consumers’ expectations were such that they were concerned about the economy and jobs, what would you think would happen in this market?
Compose your solutions to this assignment in a report as a MS Word document.
This assignment requires you to create a chart in Microsoft Excel. In order to accomplish that, you will need to enter the data in an Excel worksheet, and then use Excel to graph the data. Copy the graph from your Excel worksheet and paste it into your MS Word document along with any explanations or discussion, in-text citations if required, and responses to the list of the questions asked in this assignment.
Do not upload the Excel worksheet to the Submissions Area. The chart you create in Excel must be copied and pasted into a Word document.
To review tutorials about using Microsoft Excel, please click on the tutorial link at the top of this page. The lynda.com link you will find there contains many helpful MS Excel tutorials.