Suppose That the Demand for Cars Is Normally Distributed with Mean

question 29

Essay

Suppose that the demand for cars is normally distributed with mean of 120 and standard deviation of 20. Use @RISK simulation add-in to determine the "best" order quantity; that is, the one that has the largest expected profit. Using the statistics and/or graphs from @RISK, discuss whether this order quantity would not be considered the "best" by the car dealer.

Understand how technological improvements and wage changes affect the firm's use of capital and labor.

Understand the concepts of elastic and inelastic demand for resources, and how the presence of substitutes affects this elasticity.

Learn the effects of wage changes on the quantity of labor demanded and the elasticity of labor demand.

Understand the factors leading to shifts in the labor demand curve.

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Definitions:

Anal Character

A personality type that Freud theorized is characterized by orderliness, stubbornness, and a focus on control as a result of certain experiences during the anal stage of psychosexual development.

Dependence

A state in which there is a reliance on or need for something or someone for support or to function properly.

Regression

In psychology, regression is a defense mechanism that leads an individual to revert to a previous stage of development or to earlier, less sophisticated behaviors in response to stress or anxiety.

Transference

In psychoanalytic theory, the tendency to bring ways of thinking, feeling, and behavior that developed toward one important person into later relationships with different persons.