Samuelson and Marks, Questions and Problems # 2, p. 294.

In granting (or prohibiting) proposed acquisitions or mergers in an industry, government regulators consider a number of factors, including the acquisition’s effect on concentration, ease of entry into the market, extent of ongoing price competition, and potential efficiency gains. In 2011, T-Mobile agreed to merge with AT&T at an acquisition price or $39 billion. However, facing opposition from the Department of Justice, the companies later abandoned their merger plans. In 2011, AT&T’s market share of the U.S. wireless market was 26.6 percent, with T-Mobile 12.2 percent, Verizon 31.3 percent, Spring 11.9 percent, TracFone 5.0 percent, U.S. Cellular 3.1 percent, MetroPCS 2.3 percent, Cricket 1.6 percent, and numerous small providers making up the remaining 4 percent.

a. What would be the effect of the merger on the market’s concentration ratio? On the HHI?

b. Antitrust guidelines call for close scrutiny of mergers in moderately concentrated markets (HHI between 1,500 and 2,500) if the resulting HHI increase is more than 100 to 200 points. How would this rule apply to the AT&T merger with T-Mobile? How would it apply to a hypothetical merger between T-Mobile and TracFone?

c. AT&T argued that the merger would extend its network, providing more reliable and faster cell phone service (particularly to existing T-Mobile customers who on average have lower-grade service plans at cheaper rates). Market observers were worried that after the merger, AT&T would raise cellular rates to some customer segments. Briefly evaluate these pros and cons.

 evaluate the role of the Classical tradition (Greek and/or Roman values and characters) in Dante the pilgrim’s journey through Hell to salvation. Choose at least 2 references or figures from the Classical tradition to build your argument. Be sure to conclude your paragraph with a clear assessment of how Dante regards values from the Classical tradition in relation to the Christian framework of his pilgrimage.

A firm and its supplier are going to negotiate a deal every quarter. Since the supplier’s

cost is $10 million per quarter and the value to the firm is $14 million per quarter, there is

$4 million per quarter to split between the two. However, they can hire a negotiation

consultant for a quarter for $500,000. If neither hires the consultant, each expects to get

half of the $4 million pot. If only one hires the consultant, it expects to get three-fourths

of the pot minus the consultant costs. If they both hire consultants, they cancel each other

out and they expect to get half the pot minus the consulting costs. They expect to repeat

this process every quarter for the foreseeable future. Can they agree to ban the

consultants?

1.what are the Laspeyers and Paasche Index and explain why each of the indices does not reflect accurately the impact of price increases?

2. How is the CPI calculated based on BLS? what are the 3 weaknesses of CPI methodology.

3. what is the core CPI and why is it important?

“Problem Solving Interview Question” Please respond to the following:

• Imagine you are interviewing for a job you really want.
• The interviewer asks you the following question:  “Explain a specific example in which you used critical thinking/problem solving strategies to solve a problem in the real world.”
• What is your answer to the question?
• Choose one classmate’s own response to the interviewer’s question.  If you are a job coach, what suggestions would you make to maximize his or her answer to the interview question?