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Topic: Futures Unlimited Corporation: Cost of Producing Gloves
Part A (A 1-page response is required.)
Imagine that it is the year 2199. Technology has progressed at an incredible pace. The latest discovery is the plutonium engine, which is capable of converting plutonium, a by-product of nuclear fission, into fuel to power the nuclear reactors in our new form of transportation, the rocket-car. However, because the firm that invented the engine, the Futures Unlimited Corporation, already has a government license to control and distribute the quantity of this certain isotope of plutonium on the market, it is now conceivably in charge of a monopoly on plutonium-fueled transportation.
1. Describe the economic outcome of this single-price monopoly in terms of profit. Provide one (1) supporting fact to support your response.
2. Describe one (1) way that the Futures Unlimited Corporation makes output and price decisions.
Part B (A 1-page response is required.)
1. Would consumers benefit more from a tariff or quota on imports? Provide one (1) supporting fact to support your response.
2. Consider the following weekly production possibilities of gloves and hats in Panama and Russia:
Gloves 20 180
Hats 80 90
a. What is each country`s opportunity cost of producing gloves and hats?
b. If the countries could, should they trade? Provide one (1) supporting fact to support your position.
Futures Unlimited Corporation Name Affiliation/Institution Date Futures Unlimited Corporation Part A 1 Describe the economic outcome of this single-price monopoly in terms of profit. Provide one (1) supporting fact to support your response. A single-price monopoly simply denotes a situation where a single firm sells the units of its output at the same price to all of its customers. This is an advantage as well as a disadvantage to firms that enjoy it. First of all, a firm with this type of monopoly is able to control the market and dictate the price ranges of a particular product. This means that such a firm can as well hike prices for their own profitability agenda. Consumers are often at a loss because they get to bear the burden of higher prices. On the other han