Economic consulting and managerial economics
These questions are based on litigation consulting case interviews.
QUSTION 1:Your client is Alaska Seafood, which processes seafood in Alaska. It has a 70% market share in the Alaska seafood processing industry. The Halibut, Salmon, trout, other fish, crabs, etc are caught by local fishermen in Alaska, sold to Alaska Seafood, processed by Alaska Seafood, and sold by Alaska Seafood to supermarkets in Alaska in other states, who then sell the food to consumers. Alaska Seafood is being sued by the local salmon fishermen (who only catch salmon and sell salmon to Alaska Seafood). They are saying that over the last 20 years, during which Alaska Seafood has increased its market share from 15% to 70%, it has decreased the price per pound (lb) of salmon that it pays the salmon fishermen. The salmon fishermen argue that this is because of their large market share, which now enables them to charge monopsony prices. You argue that the prices Alaska Seafood is charging are notmonopsony prices; instead, they are fair prices.
a. What is the profit equation? (Hint: Profits = _______ – ________)
b. Why would Alaska Seafood want to expand so much? (HINT: Think about what has to happen for per unit profits to increase)
c. To defend Alaska Seafood, you look at the wages of salmon fishermen in the state of Washington, where the seafood processing industry is more competitive. To defend your client, do you hope to find that the Washington salmon fishermen are paid similar wages or different wages? Explain.
d. Assume that the “demand for salmon” is too narrow of a market definition and that there is a broader “demand for fish.” How would an increase in the supply of Russian trout in the global market affect the US market price of salmon? How would it affect the price Alaska Seafood is willing to pay its fishermen?
PLACE THIS ORDER OR A SIMILAR ORDER WITH US TODAY AND GET A GOOD DISCOUNT 🙂
Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.
You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.Read more
Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.Read more
Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.Read more
Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.Read more
By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.Read more