Assignment :
A trendy French restaurant is one of the first businesses to open in a small corner of a commercial building still under construction. The restaurant has received rave reviews and has lines of diners waiting for tables most nights.
a. In the short run (next few months), what measures should the restaurant take to maximize its profits? Explain.
b. In the long run (next six months and beyond), how can it maximize its profits? (Assume that the impressive state of demand is permanent).
Part B- 300 Words, APA Format, Cite within Paper and add references
In recent years, Chrysler Corporation initiated three-shift or nearly continuous (21-hours-per-day) production at a number of its plants. Explain why Chrysler's decision might have been prompted by movements in its wage costs or capital costs, or both. Why would Chrysler have instituted this production change for its most popular (and profitable) vehicles, its minivans and Jeep Cherokee? What risks might such a plan pose?
Part C- 300 Words, APA Format, Cite within Paper and add references
The last decade has witnessed an unprecedented number of mega-mergers in the banking industry: Bank of America's acquisitions of Fleet Bank, MBNA, and U.S. Trust; Bank of New York's acquisition of Mellon Financial; and Wells Fargo's acquisition of Wachovia, to name several of the largest consolidations. Besides growth for its own sake, these superbanks are able to offer one-stop shopping for financial services: everything from savings accounts to home mortgages, investment account, insurance vehicles, and financial planning.
a. In the short run, what are the potential cost advantages of these mergers? Explain.
b. Is a $300 billion national bank likely to be more efficient than a $30 billion regional bank or a $3 billion state-based bank? What economic evidence is needed to determine whether there are long-run increasing returns to scale in banking?
c. Do you think these mergers are predicated on economies of scope?