Managerial Economic and Quantitative Analysis Essay

Managerial Economic and Quantitative Analysis - Essay Example Thomas & Maurice, 2007). So in order to obtain the profit equation, total cost equation is subtracted from the total revenue equation (that is, profit = total revenue – total cost). However, from the equations given, there is no total cost and total revenue function. In order to obtain a total revenue function of the two firms, the demand function of each firm is integrated, and in order to obtain the total cost of each firm, the average cost function of each firm is integrated. After obtaining the total revenue and total cost functions, it is now possible to obtain the profit function. Economists argue that profits are maximized where total cost balances total revenue. So in order to obtain optimal price and output of each firm working individually, the total cost function is equated to the total revenue function (R. Thomas, C. Thomas & Maurice, 2007). This helps in obtaining the optimal output and price. Optimal price and output may also be obtained through differentiating t he profit function of each firm and equating it to zero, and then solving for the values of price and output. Consider the second case, where the two companies work together. ... Thomas, C. Thomas & Maurice, 2007). Part Two Estimation of the price per plane The estimated price per plane is as follows. price per plane (million $) probability Estimated price per plane (million $) 125 0.25 500 175 0.25 700 225 0.5 450 Optimal output and price when the firms act individually Airbus optimal price and output Airbus demand function is P = 500 – 0.0003Q. From this demand function, the total revenue function derived by integrating the demand function is TR = 500Q – 0.0003Q2. Airbus has the following Average cost function; AVC = 104.8822Q – 0.001Q2 + 0.09 Q3. By integrating this average cost function, a total cost function is obtained; TC = 104.8822Q2 – 0.001Q3 + 0.09Q4. In order to determine the optimum quantity and price the profit function is obtained first and then differentiated with respect to output. The profit function obtained is 500Q – 104.8825Q2 + 0.001Q3 – 0.09Q4. Differentiating this profit function and solving for the value of Q yields the value of Q as 500 M. Hence, substituting the value of Q in the original demand function, the value of P obtained is $ 499.85 M. thus; the optimal values of price and output are $ 499.85 Million and 500 million respectively. Boeing Optimal Output and Price The demand function of the firm is P = 700 – 0.00013Q. The total revenue function obtained through integration of the demand function is TR = 700Q – 0.00013Q2. The Average cost function of the firm is AVC = 25.8678Q – 0.00023Q2 + 0.4Q3. Integration of this function yields TR = 25.8678Q2 – 0.00023Q3 + 0.4Q4. From the total revenue and total cost functions, the following profit function is obtained, which is then differentiated and equated to zero in order to obtain the value of Q that is

Information system Master Essay Example | Topics and Well Written Essays - 2500 words

Information system Master - Essay Example We will focus on how information system works in a dynamic and turbulent environment and how it helps in the development of strategic, tactical and operation system of organizations. Moreover, we will give a glimpse of different information systems that are used like executive information systems, management information systems, risk management systems etc. In modern organizations it is very important that technology works according to the needs of the people and it works on continuous basis ensuring reliability and effectiveness. Information systems collaborate with the managers and play an important role in implementing proper technology in the organizations (Ralf, 2009). Information systems help in every aspect like creating a business plan, generation of formal reports, maintaining databases, preparing accounts etc. Decision making is the utmost task of every manager and the information system helps a lot in developing a proper and a formal decision making process (Alter, 2002). Usually the information flow from top to bottom or from bottom to top and in most of the organizations the information is managed by information management systems. Since, the decision making process is an important practice in every organization and information system provides with the decision makers with information in the form of reports, researches and huge amounts of data is compressed into shorter forms and this helps the mangers to take decisions. System generated reports are widely used by all departments and it makes the work easier for managers. The flow of information is used by managers for the decision making process and the information systems mentors the information and make sure that it will flow smoothly and will not affect the decision making process. Managers on the other hand higher professionals that can manage the flow of information and they must know that how the information in flowing in the organization. Usually the information flows from the top management to the down line workers, but in certain organization the flow of information is from down line workers to the top management and actually the flow of information varies from organization to organization. Managers of information system and the computers plan research and coordinate the computer related activities of the organization. They coordinate with each other and determine technical and organizational goals. Although this requires a proper and strong understanding of the computer systems and the technology but formal reports and detailed information can be stored and developed and can easily be presented to the top management for the purpose of decision making. Information systems are also related to the hardware and the networking side but the core purpose is related to the management side only. The needs of the organization are identified at all levels and utmost importance is given to operational and strategic perspective. Competition is also kept in mind and that's why information systems are equipped with the state of the art technology to ensure that the organization won't lag behind its competitors. An information system