Managerial Economics 14Th Edition PDF Full Chapter

Managerial Economics 14th edition
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Managerial Economics
Mark Hirschey
University of Kansas
Eric Bentzen
Copenhagen Business School
CENGAGE
Learn ing-
Australia • Brazil .. Mexico • Singapore • United Kingdom • United States
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eo..-ents vii
Transitive Property, 54 • Commutative Properties, Determinants of Demand, 79 • Industry Demand Vers11s

54 • Associative Properties, 55 • Distrib11tive Finn Demand, 80
Properties, 55 • Inverse Properties, 55 • Exponents Demand Curve 81
and RadiCllls, 55
Demand Curve Determination, 81 • Relation
Equations 56 Between the Demand Curve and Demand
Equivalent Operations, 56 • Linear Equations, 57 F11nction, 82
• Quadratic Equations, 57 • Multiplirotive Basis for Supply
Equations, 57 • Exponential Functions, 57
• Logarithmic Functions, 58 Haw Output Prices Affect Supply, 84 • Other
Factors that Influence Supply, 85
Concept of a Marginal 59
Market Supply Function 85
Rules for Differentiating a Function 61
Determinants of Supply, 85 • Industry Supply
Constants, 61 • Pawers, 62 • Sums and Versus Firm Supply, 87
Differences, 62 • Products, 63 • Quotients, 64
• Logarithmic Functions, 64 • Function of a Supply Curve 87
Function (Chain Rule), 65 Supply Curve Determination, 87 • Relation
Appendix 28: Multivariate Optimization and Between Supply Curve and Supply Function, 89
the Lagrangian Technique 67 Market Equilibrium 91
Partial Derivative Concept, 67 • Maximizing Surpl11s and Shortage, 91 • Comparative Statics:
Multivariate Functions, 68 Changing Demand, 93 • Comparative Statics:
Constrained Optimization 69 Changing Supply, 95 • Comparative Statics:
Changing Demand and Supply, 96
Role of Constraints, 70 • Lagrangian Multipliers, 71
Summary 97
Problem 75
Questions 97
Chapter 3 : Demand and Supply 77 Self-Test Problems and Solutions 98
Basis for Demand 77 Problems 101
Direct Demand, 77 • Derived Demand, 78 Case Study: Spreadsheet Analysis of Demand
Managerial Application 3.1: How the Internet and Supply for Sunbest Orange Juice 105
Affects Demand and Supply 79 Selected Reference 107
Market Demand Function 79
Part 2: Demand Analysis and Estimation 109
Chapter 1t: Demand Analysis SH Price-Consumption Curve, 122 • lncome-

Utility Theory 111
Consumption Curve, 125 • Engle Curves, 125
Basic Assumptions, 111 • Utility Functions, 112 Managerial Application 4.2: Relationship
• Marginal Utility, 113 • Law of Diminishing Marketing 128
Marginal Utility, 114 Optimal Consumption 128
Managerial Application 4.1: Odd-Num ber Marginal Utility and Consumer Choice, 128
Pricing Riddle 116 • Marginal Rate of Substitution, 129 • Utility
Indifference Curves 116
Maximiu,tion, 131
Basic Characteristics, 116 • Perfect Substit11tes Demand Sensitivity Analysis: Elasticity 132
and Perfect Complements, 118 Elasticity Concept, 132 • Point Elasticity, 132
Budget Constraints 118
• Arc Elasticity, 133
Characteristics of Budget Constraints, 118 • Effects Price Elasticity of Demand 133
of Changing Income and Changing Prices, 121 Price Elasticity Fomwla, 133 • Price Elasticity
• Income and Substitution Effects, 122 and Total Revenue, 135
Individual Demand 122 Price Elasticity And Marginal Revenue 137
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viii Contents
Elasticity Varies Along a Linear Demand C11rve, 137 Standard Error of the Estimate, 175 • Goodness
• Price Elasticity and Price Chauges, 138 of Fit, 176 • F Statistic, 178
Managerial Application 4.3: Haggling Judging Variable Significance 179
in the Car Business 141 nvo-Tail t Tests, 179 • One-Tail t Tests, 181
Price Elasticity and Optimal Pricing Policy 141 Summary 182
Optimal Price Fonuula, 141 • Optimal Pricing Questions 183
Policy Example, 142
Self-Test Problems and Solutions 183
Cross-Price Elasticity of Demand 143
Problems 188
Cross-Price Elasticity Formula, 143 • Substitutes
aud Complemeu ts, 144 Case Study: Demand Estimation for
Mrs Smyth's Pies 192
Income Elasticity of Demand 144
Selected Reference 194
• Income EJIISlidty Formula, 144 • Nonna/ Versus
Inferior Goods, 145 Chapter 6 : Forecasting 195
Managerial Application 4.4: What's in a Name? 146 Forecasting Applications 195
Summary 146 Macroeconomic Applirotious, 195 • Microeconomic
Questions 147 Applications, 196 • Forecast Tec/111iq11es, 196
Self-Test Problems and Solutions 148 Managerial Application 6.1: Economic
Forecasting: The Art and the Science 197
Problems 153
Qualitative Analysis 198
Case Study: Optimal Level of Advertising 156
Expert Opi11io11, 198 • Survey Tech11iq11es, 198
Selected References 157
Trend Analysis and Projection 199
Chapter 5: Demand Estimation 159 Trends iu Economic Data, 199 • Linear Trend
Interview and Experimental Methods 159 Analysis, 199 • Growth Trend Analysis, 202
Consumer Interviews, 159 • Market • Linear and Growth Trend Comparison, 204
Experiments, 160 Managerial Application 6.2: Prediction Markets 204
Simple Demand Curve Estimation 160 Business C yde 205
• Simple l.i11ear Demand C11rves, 160 What is the Busiuess Cycle?, 205 • Economic
• Usiug Simple Linear Demaud C11rves, 162 lndirotors, 207 • Economic Recessions, 208
Managerial Application 5.1: Sampling • Sources of Forerost Infonuation, 210
Technology for TV Advertising 161 Managerial Application 6.3: The Stock Market
Simple Market Demand Curve Estimation 163 and the Business Cycle 211
Graphiug the Market Demand Curve, 163 Exponential Smoothing 212

• E1111/11ati11g Market Demaud, 164 Exponential Smoothing Concept, 212
Identification Problem 166 • Oue-Parnmeter (Simple) Expouential
Smoothiug, 212 • nuo-Parnmeter (Holt)
Cha11gi11g Nature of Demaud Relatious, 166 Exponential Smoothing, 213 • Three-Parameter
• lllterplay of Demaud and Supply, 166 • Shifts (Winters) Expouential Smoolhiug, 214 • Practical
i11 Demand and S11pply, 167 • Simultaueous Use of Expo11e11tial Smoothiug, 214
Relatious, 169
Econometric Forecasting 215
Regression Analysis 169
Advnutages of Ecouometric Methods, 215
What is a Statistirol Relation?, 169 • Specifyiug the • Si11gle-Eq11atio11 Models, 217 • Multiple-Equation
Regressiou Model, 172 • Least Squam Method, 173 Systems, 218
Managerial Application 5.2: Market Experiments Managerial Application 6.4: How Good is Your
on the Web 170 Forecasting Ability? 216
Measures of Regression Model Significance 175 Judging Forecast Reliability 220
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eo..-ents
Tests of Predictive Capability, 220 • Correlatio11 Questions 224

A11alysis, 220 • Sample Mea11 Forecast Error Self-Test Problems and Solutions 225
A11nlysis, 220
Case Study: Forecasting Global Performance
Choosing the Best Forecast Technique 221 for a Mickey Mouse Organization 233
Data Requirements, 221 • Time Horizo11 Selected Reference 236
Co11siderntio11s, 221 • Role of Judgme11t, 223
Summary 223
Part 3: Production and Competitive Markets 237

Chapter 7: Production Analysis Productivity Measurement 262
and Compensation Policy 239 Eco11omic Productivity, 263 • Productivity a11d
Production Functions 239 Investment i11 Computer Tech110/ogy (JCT), 264
Properties of Produdio11 Fu11ctio11s, 239 • Reflm1s to Managerial Application 7.4: Labor productivity
Scale and Returns ton Factor, 240 growth in selected countries 2009-2012. 263
Total, Marginal, and Average Product 240 Summary 265
• Total Product, 241 • Margi11al and Average Questions 266
Product, 242 Self-Test Problems and Solutions 266
Law of Diminishing Returns to a Factor 245 Problems 269
lllustrntiolt of Di111inishi11g Retums ton Factor, 247 Case Study: Worker Productivity Among
Managerial Application 7.1: Efficiency Wages 246 Giant US Corporations 274
Input Combination Choice 248 Selected References 276
Productio11 lsoqua11ts, 248 • l11put Factor Appendix 7A: A Constrained Optimization
Substifl1tion, 248 • Margi11al Rate of Tee/mien/ Approach to Developing the Optimal Input
Substifl1tion, 251 • Rational Limits of Input Combination Relationships 277
Substifl1tion, 251 Constrained Production Maximization 277
Marginal Revenue Product and Optimal Constrained Cost Minimization 279
Employment 252
Problem 280
Margi11nl Revenue Product, 252 • Optimal
Leve/ of n Single Input, 253 • lllustration of Chapter 8 : Cost Analysis and Estimation 281
Optimal Employment, 254
Economic and Accounting Costs 281
Managerial Application 7.2: National minimum
wages in the EU 253 Historical Versus Curre11t Costs, 281
• Opportunity Costs, 282
Optimal Combination of Multiple Inputs 255
Role of Time in Cost Analysis 283
Budget Li11es, 255 • Expansio11 Path, 257
lncreme11tnl Versus Sunk Cost, 283 • How is
• lllustration of Optimal Input Proportions, 258
the Operati11g Period Defi11ed?, 284
Managerial Application 7.3: The Future of
Managerial Application 8.1: GE's '20-70-10' Plan 284
Manufacturing in Europe 2015-2020 259
Short-Run Cost Curves 285
Optimal Levels of Multiple Inputs 259
Short-Run Cost Categories, 285 • Short-Run
Optimal Employme11t n11d Profit Mnrimi111tio11, 259
• lllustration of Optimal Levels of Multiple Cost Relations, 286
Inputs, 260 Managerial Application 8.2: GAAP and IRFS 288
Returns to Scale 260 Long-Run Cost Curves 288
• Output Elasticity a11d Returns to l.011g-Run 1btal Costs, 288 • Eanromies of Scale, 290
Scale, 260 • Reft1ms to Scale Estimation, 261 • Cost Elasticities and Eco110111ies of Scale, 290
• Long-Ru11 Average Costs, 291
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x Contents
Managerial Application 8.3: Cost Stickiness 293 Objective Function Specification, 330 • Constraint
Minimum Efficient Scale 293 Equation Specifirotion, 331 • Non-negativity
Requirement, 331
Competitive Implications of Minimum Efficient
Scale, 293 • Transportation Costs and MES, 293 Graphic Specification and Solution 332
Firm Size and Plant Size 295 Analytic Expression, 332 • Graphing the
Feasible Space, 332 • Graphing the Objective
Mu/tip/ant Economies and Diseconomies of Fundion, 334 • Graphic Solution, 335
Scale, 295 • Economics of Mu/tip/ant
Operation: an Example, 296 • Plant Size and Algebraic Specification and Solution 336
Flexibility, 298 Algebraic Specification, 336 • Algebraic
Learning Cur ves 300 Solution, 338
I.earning Curve Concept, 300 • I.earning Curve Managerial Application 9.3: LP on the PC! 341
Example, 302 • Strategic Implications of the Dual in Linear Programming 342
I.earning Curve Concept, 303 Duality Concept, 342 • Shadow Prices, 342
Managerial Application 8.4: Bigger isn't Dual Specification 343
Always Better 301
Dual Objective Function, 343 • Dual
Economies of Scope 304 Constraints, 343 • Dual Slack Variables, 344
Economies of Scope Concept, 304 • Exploiting Solving the Dual Problem 345
Scope Economies, 305
Dual Solution, 345 • Using the Dual Solution
Cost-Volume-Profit Analysis 305 to Solve the Primal, 346
• Cost-Volume-Profit Charts, 305 • Degree Summary 348
of Operating Leverage, 307
Questions 349
Summary 309
Questions 310
Problems 357
Case Study: A LP Pension Funding Model 362
Problems 313
Appendix 9A: Rules for Forming the Dual linear
Case Study: Estimating Hospitalization Costs Programming Problem 365
for Regional Hospitals 317
Primal Problem 365
Dual P roblem 366
Chapter 9 : Linear Programming 321 Selected References 367
Basic Assumptions 321
Chapter so: Competitive Markets 369
Inequality Constraints, 321 • Linearity
Assumption, 322 Competitive Environment 369
Managerial Application 9.1: Karmarkar's LP What is Market Struchire?, 369 • Vital Role
Breakthrough 322 of Potential Entrants, 370
Production Planning fo r a Single Product 323 Factors that Shape the Competitive Environment 370
Production Processes, 323 • Production Product Differentiation, 370 • Production
Isoquants, 324 • Least-Cost Input Combinations, 326 Methods, 372 • Entry and Exit Conditions, 372
• Optimal luput Combinations with Limited Managerial Application JO.I : Benefits From
Resources, 327 Free Trade 371
Managerial Application 9.2: LP: More than a Competitive Market Characteristics 373
Visual Approach 330
Basic Feat11res, 373 • Examples of Competitive
Production Planning fo r Multiple Products 330 Markets, 373 • Profit Maximization Imperative, 375
• Role of Marginal Analysis, 375
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eo..-ents
Managerial Application I 0.2: Seasonality Role for Government 410

on Stock Markets? 374 How Government Influences Competitive
Marginal Cost and Firm Supply 379 Markets, 410 • 8T0<1d Social Co11sideratio11s, 411
Short-Run Finn Supply Curve, 379 • Long-Run Managerial Application 11.2: Corn Growers
Finn Supply Curve, 381 Discover Oil' 411
Managerial Application I 0.3: Dot.com 382 Subsidy and Tax Policy 411
Competitive Market Supply Curve 382 Anti-Subsidy Rules, 412 • Dendweight Loss
Market Supply with a Fixed Number of from Taxes, 412
Competitors, 382 • Market Supply with Entry Tax Incidence and Burden 414
and Exit, 384 Role of Elasticity, 414 • Tax Cost- Sharing
Competitive Market Equilibrium 385 Example, 415
Balance of Supply and Demand, 386 • Normnl Managerial Application 11.3: Measuring
Profit Equilibrium, 387 Economic Profits 418
Managerial Application I 0.4: The Enron Price Controls 418
Debacle 388 Price Floors, 418 • Price Ceilings, 420
Summary 388 Business Profit Rates 422
Questions 389 Return 011 Stockholders' Equity, 422 • Typical
Self-Test Problems and Solutions 390 Profit Rates, 423
Problems 395 Market Structure and Profit Rates 425
Case Study: Profitability Effects of Firm Profit Rates in Competitive Markets, 425
Size for DJIA Companies 399 • Mean Reversion in Profit Rates, 426
Selected References 401 Competitive Market Strategy 426
Chapter 11: Performance and Strategy

Short-Run Finn Performance, 427
in Competitive Markets 403 Long-Run Firm Performance 428
Competitive Market Efficiency 403 Summary 428
Why is it Called Perfect Competition?, 403 Questions 430
• Deadweight Loss Problem, 404 • Deadweight Self-Test Problems and Solutions 431
Loss Illustration, 406
Problems 437
Managerial Application 11.1: The Wal-Mart
Phenomenon 407 Case Study: The Most Profitable S&P 500
Companies 441
Market Failure 408
Strnctural Problems, 408 • Incentive Problems, 409
Part 4: Imperfect Competition ltltS

Chapter 12: Monopoly and Monopsony ltlt7 Price-Output Decisions, 449 • Role of Marginal
Monopoly Market Characteristics 447 Analysis, 451
Basic Features, 447 • Examples of Monopoly, 448 Social Costs of Monopoly 453
Managerial Application 12.1: The EU Monopoly Underproduction, 453 • Dendweight Loss

Commission fines parking heaters producer from Monopoly, 453
€68 million in cartel settlement 449 Social Benefits of Monopoly 457
Profit Maximization Under Monopoly 449 Economies of Scale, 457 • Invention and Innovation, 457
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xii Contents
Monopoly Regulation 458 Oligopoly 498

Dilemma of Natural Monopoly, 458 • Utility Price Oligopoly Market Characteristics, 499
and Profit Regulation, 460 • Utility Price and Profit • Examples of Oligopoly, 499
Regulation Example, 462 • Problems with Utility Price Cartels and Collusion 500
and Profit Regulation, 464
Overt and Covert Agreements, 500
Managerial Application 12.2: Is Ticketmaster • Enforcement Problems, 501
a Monopoly? 459
Oligopoly Output-Setting Models SOI
Monopsony 464
Coumot Oligopoly, 501 • Stackelberg
Buyer Puwer, 464 • Bilateral Monopoly Oligopoly, 504
11/ustration, 465
Oligopoly Price-Setting Models 507
Managerial Application 12.3: is this why
they Call it 'Hardball'? 468 Bertrand Oligopoly: Identical Products, 507
• Ber/rand Oligopoly: Diffem1tinted Products,
Antitrust Policy 468 508 • Sweezy Oligopoly, 511 • Oligopoly Model
Overview of Antitrust !.Jlw, 468 Comparison, 512
Managerial Application 12.4: Price Fixing Managerial Application 13.3: Contestable
by the Insurance Cartel 469 Airline Passenger Service Markets 513
Competitive Strategy in Monopoly Markets 469 Market Structure Measurement 513
Market Niches, 469 • Information Ba"iers to Economic Census, 513 • NAICS System, 514
Competitive Strategy, 470 Census Measures of Market Concentration 516
Summa ry 472 Concentration Ratios, 516 • Herfindahl-
Questions 473 Hirschmann Index, 518 • Limitations of
Self-Test Problems and Solutions 473 Census lnfonnation, 518
Problems 480 Managerial Application 13.4: Horizonta l
Merger Guidelines 519
Case Study: Effect of R&D on Tobin's q 484
Summary 522
Questions 524
Chapter 13: Monopolistic Competition Self-Test Problems and Solutions 524
and Oligopoly 489 Problems 528
Contrast Behveen Monopolistic Competition Case Study: Market Structure Analysis
and Oligopoly 489 at Columbia Drugstores, Inc. 533
Monopolistic Competition, 489 • Oligopoly, 490 Selected References 535
• Dynamic Nature of Competition, 491
Chapter 14: Game Theory and Competitive
Monopolistic Competition 491
Strategy 537
Monopolistic Competition Characteristics, 491 Game Theory Basics 537
• Monopolistic Competition Price-Output
Decisions, 493 Types of Games, 537 • Role of Interdependence,
538 • Strategic Considerations, 539
Managerial Application 13.1: Dell's Price
War with Dell 492 Managerial Application 14.1: Asymmetric
Information 539
Managerial Application 13.2: Intel: Running
Fast to Stay in Place 495 Prisoner's Dilemma 540
Monopolistic Competition Process 495 Classic Riddle, 540 • Business Application,
541 • Broad lmplirotions, 542
Short-Run Monopoly Equilibrium, 495
• Long-Run High-Price/Low-Output Nash Equilibrium 543
Equilibrium, 496 • Long-Run Low-Price/ Nash Equilibrium Concept, 543 • Nash
High-Output Equilibrium, 498 Bargaining, 544
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eo..-ents xiii
Infinitely Repeated Games 545 Price Discrimination Example 580

Role of Reputation, 545 • Product Quality Price-Output Determination Case I, 581
Games, 546 • One-Price Alternative, 583 • Price-Output
Managerial Application 14.2: The Market Determination Case 11, 585
for Lemons 547 Managerial Application 15.2: Do Colleges
Finitely Repeated Games 547 Price Discriminate? 581
Uncertain Final Period, 547 • End-cf-Game Two-Part Pricing 586
Problem, 548 One-Price Policy and Consumer Surplus, 586
Game Theory and Auction Strategy 549 • Capturing Consumer Surplus with nuo-Part
First-Mover Adtxmtages, 549 • Auction Types, 549 Pricing, 588 • Consumer Surplus and Bundle
• Public Policy Applications, 550 Pricing, 588
Managerial Application 14.3: Wrigley's Success Multipl~Product Pricing 589
Formula 551 Demand Interrelations, 589 • Production
Competitive Strategy 551 lnterrelations, 590
Competitive Advantage, 551 • When Large Siu Joint Products 591
is a Disadvantage, 553 Joint Products in Variable Proportions, 591
Pricing Strategies 553 • Joint Products in Fixed Proportions, 591
l.imit Pricing, 553 • Network Externalities, 555 Joint Product Pricing Example 593
• Market Penetration Pricing, 555 Joint Products without Excess By-Product, 593
Managerial Application 14.4: Network • Joint Production with Excess By-Product
Switching Costs 556 (Dumping), 596
Nonprice Competition 556 Managerial Application 15.3: I Oe for a Gallon
Advantages of No11price Competition, 556 of Gas in Dayton, Ohio 594
• Optimal Level of Advertising, 557 Managerial Application 15.4: Why Some
• Optimal Advertising Example, 559 Price Wars Never End 598
Summary 561 Summary 598
Questions 562 Questions and Answers 599
Self-Test Problems and Solutions 562 Self-Test Problems and Solutions 600
Problems 565 Problems 602
Case Study: Time Warner, Inc., is Playing Case Study: Pricing Practices in the Denver,
Games with Stockholders 570 Colorado, Newspaper Market 606
Selected References 572 Selected References 608
Chapter 15: Pricing Practices 573 Appendix ISA: Transfer Pricing 609
Pricing Rules-of-Thumb 573 Transfer Pricing Problem 609
Competitive Markets, 573 • Imperfectly Divisional Relationships, 609 • Products without
Competitive Markets, 574 Extemal Markets, 610 • Products with Competitive
Managerial Application JS.I: Mark-Up Pricing Extemal Markets, 610 • Products with Imperfectly
Technology 575 Competitive External Markets, 611
Mark-Up Pricing and Profit Maximization 575 Global Transfer Pricing Example 611
Optimal Mark-Up 011 Cost, 575 • Optimal Profit Maximiurtion for an lntegrated Firm, 611
Mark-Up 011 Price, 576 • Why Do Optimal • Transfer Pricing with No External Market, 612
Mark-Ups Vary?, 577 • Competitive External Market with Excess lnternal
Price Discrimination 578 Demand, 613 • Competitive Extemal Market with
Excess lntemal Supply, 614
Profit-Making Criteria, 578 • Degrees of Price
Discrimination, 579 Problem 615
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xiv Contents
Part 5: Long-Term Investment Decisions 617

Chapter 16: Risk Analysis 619 Sequence of Project Valuation, 660 • Cash
Concepts of Risk and Uncertainty 619 Flow Esti111ation, 661 • Incremental Cash
Flow Evaluation, 661
Econo111ic Risk a11d U11certai11ty, 619 • General
Risk Categories, 620 • Special Risks of Globnl Managerial Application 17.1: Market-Based
Operotio11s, 621 Capital Budgeting 662
Probability Concepts 621 Cash Flow Estimation Example 662
Project Descriptio11, 662 • Cash Flow
• Probnbility Distribution, 622 • Expected
Esti111ation a11d A11nlysis, 663
Value, 623 • Absolute Risk Measure111ent, 625
• Relative Risk Measure111ent, 627 • Other Risk Capital Budgeting Decision Rules 665
Measures, 627 Net Prese11t-Value A11alysis, 665 • Profitability
Managerial Application 16.1: Behavioral Finance 622 Index or Be11efit/Cost Ratio A11alysis, 668
• Internal Rate of Return Analysis, 668
Standard Normal Concept 628 • Paybnck Period A11alysis, 669
Nor111al Distribution, 628 • Standardiud Project Selection 670
Variables, 629 • Use of the Sta11dard Normal
Concept: a11 Exa111ple, 629 Decisio11 Rule Co11flict Problem, 670
Managerial Application 16.2: Why are Managerial Application 17.2: Is the Sun
Lotteries Popular? 630 Setting on Japan's Vau nted MOF? 671
Utility Theory and Risk Analysis 630 Reasons for Decision Rule Conflict, 672
• Rnnki11g Reversal Problem, 672 • Making
Possible Risk Attih,des, 631 • Relation the Correct lnvesh11ent Decisio11, 675
Betwee11 Money a11d its Utility, 631
Cost of Capital 675
Adjusting the Valuation Model for Risk 632
Compo11e11t Cost of Debt Fina11ci11g, 675
Basic Valuatio11 Model, 632 • Certai11ty • Co111po11e11t Cost of Equity Fi11ancing, 676
Equivalent Adjust111ents, 633 • Certai11ty • Weighted-Average Cost of Capital, 679
Equivalent Adjust111ent Exa111ple, 635 Managerial Application 17.3: Federal Government
• Risk-Adjusted Discou11t Rates, 636,
Su pport for R&D 676
• Risk-Adjusted Discou11t Rate Example, 637
Managerial Application 17.4: Capital Allocation
Managerial Application 16.3: Stock Option at Berkshire Hathaway, Inc. 681
Backdating Scandal 633
Optimal Capital Budget 681
Decision Trees and Computer Simulation 638
Investment Opportunity Schedule, 681
Decisio11 'frees, 638 • Computer Sitnulation, 639 • Margi11al Cost of Capital, 683 • Postaudit, 683
• Co111puter Simulation Exo111ple, 640
Su mmary 684
Managerial Application 16.4: Internet Fraud 642
Questions 684
Su mmary 643
Questions 644
Problems 689
Case Study: Sophisticated NPV Analysis a t
Problems 649 Level 3 Communications, Inc. 694
Case Study: Stock-Price Beta Estimation Selected References 698
for Google, Inc. 653
Chapter 11: Organization Structure and
Corporate Governance 701
Chapter 17: Capital Budgeting 659 Organization Structure 701
Capital Budgeting Process 659 What is Orga11izatio11 Stmcture?, 701 • Opti111al
What is Capital Budgeti11g?, 659 • Project Design is Dy11amic, 702
Classification Types, 660 Transaction Cost Theory of the Firm 703
Steps in Capital Budgeting 660 Nature of Fin11s, 703 • Coase Theore111· 704
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eo..-ents xv
The Firm's Agency Problem 704 Rivnlry and Exclusion, 740 • Free Riders and
Sources of Conflict within Firms, 704 • Risk Hidden Preferences, 741
Management Problems, 705 • Investment Horizon Managerial Application 19.2: Political
Problems, 707 • lnfonnation Asymmetry Corruption 743
Problems, 707
Optimal Allocation of Social Resources 744
Managerial Application 18.1: Organization
Design at GE 705 Pareto Improvement, 744 • Marginal Socinl
Costs and Benefits, 744
Organization Design 708
Benefit-Cost Methodology 746
Resolving Unproductive Conflict within
Finns, 708 • Centraliwtion Versus Benefit-Cost Concepts, 746 • Social Rate
Decentraliwtion, 709 of Discount, 747
Decision Management and Control 710 Benefit-Cost Criteria 748
Assigning Decision Rig/Jts, 710 • Decision Socinl Net Present-Vnl11e, 748 • Benefit-Cost
Process, 711 Ratio, 750 • Social luternal Rate of Return, 751
Corporate Governance 712 • Limitations of Benefit-Cost Analysis, 752
Role Played by Boards of Directors, 712 Additional Methods of Improving Public
Managerial Application 18.2: Company Management 752
Information on the Internet 713 Cost-Effectiveness Analysis, 752 • Privatiwtion, 753
Corporate Governance Inside the Firm, 714 Managerial Application 19.3: Free Trade Helps
Managerial Application 18.3: Sarbanes-Oxley 715 Everyone 753
Ownership Structure as a Corporate Regulatory Reform in the New Millennium 755
Governance Mechanism 715 Promoting Competition in Electric Power
Dimensions of Ownership Structure, 715 Generation, 755 • Fostering Competition in
• ls Ownership Structure Endogenous?, 719 Telecommunications, 755 • Reforming
Managerial Application 18.4: Institutional Environmental Regulation, 756 • Improving
Investors are Corporate Activists no Regulation of Health and Safety, 756
Agreements and Alliances Among Firms no Managerial Application 19.4: Price Controls
Franchising, 720 • Strategic Alliances, 721 for Pharmaceutical Drugs 757
Legal and Ethical Environment 722 Health Care Reform 757
Sarbanes-Oxley Act, 722 • Business Ethics, 723 Managed Competition, 757 • Outlook for
Summary 723
Health Care Reform, 759
Questions 725 Summary 760
Self-Test Problems and Solutions n6 Questions 761
Problems n8 Self-Test Problems and Solutions 762
Case Study: Do Boards of Directors Make Problems 767
Good Corporate Watchdogs? 731 Case Study: Oh, Lord, Won't You Buy
Selected References 734 Me a Mercedes-Benz (Factory)? 772
Chapter 19: Government in the Market Selected References 774
Economy 735 Appendix A: Compounding and the
Externalities 735 Time Value of Money 775
Negative Externalities, 735 • Positive
Externalities, 736 Appendix B: Interest Factor Tables 791
Managerial Application 19.1: 'Tobacco' Ethics 738 Appendix C: Statistical Tables 799
Solving Externalities 738
Selected Check Figures for End-of-Chapter
Government Solutions, 738 • Market Problems 805
Solutions, 739
Public Goods 740 Index 811
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Economic concepts show how to apply common sense to understand business and solve
managerial problems. Economic intuition is really useful. It helps managers decide on which
products to produce, costs to consider, and prices to charge. It also helps them decide on the
best hiring policy and the most effective style of organization. Students and future managers
need to learn these things. The topics covered in managerial economics are powerful tools
that can be used to make them more effective and their careers more satisfying. By studying
managerial economics, those seeking to further their business careers learn how to more
effectively collect, organize and analyze information.
A key feature of this book is its depiction of the firm as a cohesive organization. Effective
management involves an integration of the accounting, finance, marketing, personnel, and
production functions. This integrative approach demonstrates that important managerial
decisions are i11terdiscipli11ary in the truest sense of the word.
Although both microeconomic and macroeconomic relations have implications for
managerial decision making, this book concentrates on microeconomic topics. Following
development of the economic model of the firm, the vital role of profits is examined. Because
economic decision making often requires an elementary understanding of optimization
techniques and statistical relations, those basic concepts are described early in the text.
Because demand for a firm's products plays a crucial role in determining its profitability and
ongoing success, demand analysis and estimation is an essential area of study. An important
part of this study is an investigation of the basic forces of demand and supply. This naturally
leads to discussion of economic forecasting and methods for assessing forecast reliability.
Production theory and cost analysis are then explored as means for understanding the
economics of resource allocation and employment.
Once the internal workings of a successful firm are understood, attention can turn
toward consideration of the firm's external economic environment. Market structure analysis
provides the foundation for studying the external economic environment and for defining
an effective competitive strategy. The role of government in the market economy, including
the constraints it imposes on business, requires a careful examination of regulation and
antitrust law. Risk analysis and capital budgeting are also shown as methods for introducing
marginal analysis into the long- range strategic planning and control process. Finally, given
government's increasing role in managing demand and supply for basic services, such as
education and health care, the use of economic principles to understand and improve public
management is also considered.
Managerial Eco11omics, 14th Edition, takes a practical problem -solving approach. The focus
is on the economics--not the mathematics--of the managerial decision process. Quantitative
tools are sometimes employed, but the emphasis is on economic intuition.
Copynght 2016 Cc~ 1nr..~ . All Rtgfll! Rtllervcd. t.by nOI bt .:opltd,. SCWII.Yd, or duplu.::ued,. m wbol~ or in par1. Out IIO eltelrotm: nsfiis.some tb• d patty ~l.'1.'11 m.3)' bt t u p ~ from lhc '"-Book andlo, ~<:btl~er(s).
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Prerace xvii
r THIS UfTH EDITION

Students and instructors will find that Managerial Economics, 14th Edition provides an efficient
calculus-based introduction and guide to the optimization process. Chapter 2, Economic
Optimization, illustrates how the concept of a derivative can be used as a practical tool to
understand and apply marginal analysis. Multivariate Optimization and the Lagmngian Technique,
Appendix 2B, examines the optimization process for equations with three or more variables.
Such techniques are especially helpful when managers face constrained optimization problems,
or decision situations with limited alternatives. Throughout the text, a wide variety of problems
describing real-world decisions can be solved using such techniques.
Managerial Economics, 14th Edition provides an intuitive guide to marginal analysis and basic
economic relations. Although differential calculus is an obviously helpful tool for understanding
the process of economic optimization, it is important that students not let mathematical
manipulation get in the way of their basic grasp of economic concepts. The concept of a
marginal can also be described graphically in an intuitive noncalculus-based approach. Once
students learn to grasp the importance of marginal revenue and marginal cost concepts, the
process of economic optimization becomes intuitively obvious. Although those using a non-
calculus based approach can safely skip parts of Chapter 2 and Appendix 2B, all other material
is fully and completely assessable. With practice using a wide variety of problems and examples
throughout the text, all students are able to gain a simple, practical understanding of how
economics can be used to understand and improve managerial decisions.
Learning Aids
• Each chapter incorporates a wide variety of simple numerical examples and detailed
practical illustrations of chapter concepts. These features portray the valuable use and
real-world implications of covered material.
• Each chapter includes short Managerial Applications boxes to show current examples of
how the concepts introduced in managerial economics apply to real-world situations.
New Managerial Applications based on articles from the Internet or Barron's, Business
Week, Forbes, Fortune, and The Wall Street Journal are provided. This feature stimulates
student interest and offers a popular basis for classroom discussion.
• The book incorporates several new regression-based illustrations of chapter concepts
using actual company data, or hypothetical data adapted from real-world situations. Like
all aspects of the text, this material is self-contained and intuitive.
• Effective managers must be sensitive to the special challenges posed by an increasingly
global marketplace. To increase student awareness of such issues, a number of examples,
Managerial Applications, and case studies that relate to global business topics are featured.
• Each chapter is accompanied by a case study that provides in-depth treatment of chapter
concepts. To meet the needs of all instructors and their students, these case studies are
written to allow, but do not require, a computer-based approach. These case studies
are fully self-contained and especially helpful to instructors who wish to more fully
incorporate the use of basic spreadsheet and statistical software in their courses.
• New end-of-chapter questions and problems are provided, after having been subject
to necessary revision and class testing. Questions are designed to give students the
opportunity to grasp basic concepts on an intuitive level and express their understanding
in a nonquantitative fashion. Problems cover a wide variety of decision situations and
illustrate the role of economic analysis from within a simple numerical framework.
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xviii Preface
• Each chapter includes self-test problems with detailed solutions to show students how
economic tools and techniques can be used to solve practical business problems. These
self-test problems are a proven study aid that greatly enhances the learning value of end-
of-chapter questions and problems.
Ancillary Package
Managerial Economics, 14th Ed ition, is supported by the most comprehensive ancillary
package available in managerial economics to make teaching and learning the material
both easy and enjoyable.
Instructor's Manual The Instructor's Manual offers learning suggestions, plus detailed
answers and solutions for all chapter questions and problems. Case study data are also
provided to adopters with the Instructor's Manual. The Instructor's Manual files can be found
on the website intemational.cengage.com.
Test Bank A comprehensive Test Bank is also provided that offers a variety of multiple-choice
questions, one-step, and multistep problems for every chapter. Full solutions are included, of
course. With nearly 1,000 questions and problems, the Test Bank is a valuable tool for exam
preparation. The Test Bank files can be found on the website intemational.cengage.com.
Acknowledgments
A number of people have aided in the preparation of Managerial Economics. Helpful suggestions
and constructive comments have been received from a great number of instructors and students
who have used previous editions. Numerous reviewers have also provided insights and assistance
in clarifying difficult material. Among those who have been especially helpful in the development
of previous editions are: Barry Keating, University of Notre Dame; Stephen Conroy, University of
San Diego; Xu Wang, Texas A&M University; Michael Brandl, University of Texas-Austin; Neil
Carston, California State University- Los Angeles; Albert Okunade, University of Memphis;
David Carr, University of South Dakota; Steven Rock, Western Illinois University; Mel Borland,
Western Kentucky University; Tom Staley, San Francisco State University.
For the present edition I thank Kjeld Tyllesen and Carsten Scheibye both from
Copenhagen Business School.
I am also indebted to staff at Cengage Leaming for making the 14th a reality.
Many thanks to the reviewers of this ed ition, Gu Guowei of London South Bank
University, UK and Dr Tendeukayi Mugadza of Monash University, South Africa.
Every effort has been made to minimize errors in the book. However, errors do
occasionally slip through despite diligent efforts to provide an error-free package of text
and ancillary materials. Readers are invited to correspond with me directly concerning any
corrections or other suggestions.
It is obvious that economic efficiency is an essential ingred ient in the successful
management of both business and public-sector organizations. Like any dynamic area of
study, the field of managerial economics continues to undergo profound change in response
to the challenges imposed by a rapidly evolving environment. It is exciting to participate
in these developments. I sincerely hope that Managerial Economics contributes to a better
understanding of the usefulness of economic theory.
Finally, I would like to thank my wife Birgitte for her patience and understanding.
Eric Bentzen
bentzen@cbs.dk
November 2015
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CHAPTER 1
Nature and Scope
of Managerial Economics
CHAPTER 2
Economic Optimization
CHAPTER 3
Demand and Supply
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Nature and Scope
of Managerial Economics
Warren E. Buffett, celebrated chairman of Omaha, Nebraska-based Be rkshire Hathaway, Inc., started
an investment partnership with $100 in 1956 and went on to accumulate a personal net worth in
excess of $50 billion.
Buffett is famous for his razor-sharp focus on the competitive advantages of Berkshire's wide
assortment of operating companies, including Benjamin Moore (paints), Borsheim's ijewelry), Clayton
Homes, Dairy Queen, Fruit of the Loom, GEICO (insurance), General Re Corporation (reinsurance),
MidAmerican Energy, the Nebraska Furniture Mart, See's Candies and Shaw's Industries (carpet and
floor coverings). Berkshire subsidiaries commonly earn more than 30 per cent per year on invested
capital, compared with the 10 per cent to 12 per cent rate of return earned by other well-managed
companies. Additional contributors to Berkshire's outstanding performance are substantial common
stock holdings in American Express, Coca-Cola, Procter & Gamble and Wells Fargo among others. As
both a skilled manager and an insightful investor, Buffett likes wonderful businesses with high rates
of return on investment, lofty profit margins and consistent earnings growth. Complicated businesses
that face fierce competition and require large capital investment are shunned.•
Buffett's success is powerful testimony to the practical usefulness of managerial economics.

Managerial economics answers fundamental questions. When is the market for a product so attractive
that entry or expansion becomes appealing? When is exit preferable to continued operation? Why
do some professions pay well, while others offer only meager pay? Successful managers make good
decisions, and one of their most useful tools is the methodology of managerial economics.
r HOW IS MANAGERIAL ECONOMICS USEFUL?

Economic theory and methodology lay down rules for improving business and public
policy decisions.
Evaluating Choice Alternatives

Managerial Managerial economics helps managers recognize how economic forces affect organizations
Economics and describes the economic consequences of managerial behavior. It also links economic
Applies economic
tools and techniques concepts, data and quantitative methods to develop vital tools for managerial dedsion-
to business and making. This process is illustrated in Figure 1.1.
administrative d ecision-
making.
1 Information about Warren Buffctt"s investment philosophy and Berkshire Hatha,'/ayi Inc., can be found
on the Internet, http://www.bcrkshirchathaway.com
3
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4 Part 1: Ove1view o f Manage1ial Economics
Figure 1.1 Managerial Economics is a Tool for Improving Management Deosion-Making
ManageriaJ economics uses econon,ic concepts and quantitative n1ethods to solve n\anagerial problen1S.
Management Decision Problems

• Product selection, output and pricing
• Internet strategy
• Organization desig:i
• Product development and promotion
strategy
• Worker hiring and training
• Investment and financing
Economic Concepts Quantitative Methods

• Marginal analysis • Numerical analysis
• Theory of consumer demand • Statistical estimation
• Theory of the firm • Forecasting procedures
• Industrial organization and firm • Game-theory concepts
behavior • Optimization techniques
• Poolic choice theory • Information systems
~ Managerial Economics
Use of economic concepts and
quantitative methods to solve
management decision problems
/
Optimal solutions to management
decision problems
Managerial economics identifies ways to achieve goals efficiently. For example,

suppose a small business seeks rapid growth to reach a size that permits efficient use
of national media adver tising, managerial economics can be used to identify pricing
and production strategies to help meet this shor t-run objective quickly and effectively.
Similarly, managerial economics provides production and marketing rules that permit
the company to maximize net profits once it has achieved growth or mar ket share
objectives.
Managerial economics has applications in both profit and not-for-profit sectors. For
example, an administrator of a nonprofit hospital strives to provide the best medical care
possible given limited medical staff, equipment, and related resources. Using the tools
and concepts of managerial economics, the administrator can determine the optimal
allocation of these limited resources. In short, manager ial economics helps managers
arrive at a set of operating rules that aid in the efficient use of scarce human and capital
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Chapte, I: Nature and Scope ol Managerial Economics s
resources. By following these rules, businesses, nonprofit organizations and government

agencies are able to meet objectives efficiently.
Making the Best Decision

To establish appropriate decision rules, managers must understand the economic
environment in which they operate. For example, a grocery retailer may offer consumers
a highly price-sensitive product, such as milk, at an extremely low markup over
cost - say, 1 per cent to 2 per cent - while offering less price-sensitive products, such
as nonprescription drugs, at markups of as high as 40 per cent over cost. Managerial
economics describes the logic of this pricing practice with respect to the goal of profit
maximization. Similarly, managerial economics reveals that auto import quotas reduce
the availability c.>f substitutes fc.>r dc.>mestically prc.>duced cars, raise autc.> prices, and
create the possibility of monopoly profits for domestic manufacturers. It does not explain
whether imposing quotas is good public policy; that is a decision involving broader
political considerations. Managerial economics only describes the predictable economic
consequences of such actions.
Managerial economics offers a comprehensive application of economic theory and
methodology to management decision-making. It is as relevant to the management
of government agencies, cooperatives, schools, hospitals, museums, and similar not-
for-profit institutions as it is to the management of profit-oriented businesses. Although
this text focuses primarily on business applications, it also includes examples and
problems from the government and nonprofit sectors to illustrate the broad relevance of
managerial economics.
Business Ethics
In Finandal Times, you can sometimes find evidence of • Accept responsibility for your mistakes, and fix them. Be
unscrupulous business behavior.However, unethical conduct quick to share credit for success.
is inconsistent w ith value maximization and contrary to • Leave something on the table. Profit with your customer,
the enlightened self-interest of management and other not offyour customer.
employees. tf honesty didn't pervade corporations, the ability • Stick by your principles.Principles are not for sale at any
to conduct business would collapse. Eventually, the truth price.
always comes out, and when it does the unscrupulous lose
Does the 'high road'lead to corporate success? Consider the
out. For better or worse, we are known by the standards we
experience of A.P. Moller/Maersk - a Scandinav ian company.
adopt. To become successful in business, everyone must
At AP. Moller/Maersk their founder used the phra.se:'no loss
adopt a set of principles. Ethical rules to keep in mind w hen
should hit us, which by due diligence could be averted'.
conducting business include:
• Above all else, keep your word. Say what you mean. and See: hnP'Jlwww.maetSk.com
mean w hat you say.
• Do the right thing. A handshake with an honorable
person is worth more than a ton of legal documents from
a corrupt individual.
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6 Part 1: Ove1view of Manage1ial Economics
rTHEORY OF THE FIRM

Firms are useful for producing and distributing goods and services.
Expected Value Maximization

At its simplest level, a business enterprise represents a series of contractual relationships
that specify the rights and responsibilities of various parties (see Figure 1.2). People directly
involved include customers, stockholders, management, employees, and suppliers. Society
is also involved because businesses use scarce resources, pay taxes, provide employment
opportunities, and produce much of society's material and services output. The model
Theory of the of business is called the theory of the firm. In its simplest version, the firm is thought to
Firm have profit maximization as its primary goal. The firm's owner-manager is assumed to be
Basic model o(
business. working to maximize the firm's short-run profits. Today, the emphasis on profits has been
broadened to encompass uncertainty and the time value of money. In this more complete
Expected Value model, the primary goal of the firm is long-term expected value maximization.
Maximization The value of the firm is the present value of the firm's expected future net cash
Optimization of
profits in light of flows. If cash flows are equated to profits for simplicity, the value of the firm today, or
uncertainty and its present value, is the value of expected profits, discounted back to the present at an
the time value of appropriate interest rate.2
money.
This model can be expressed as follows
Value of the Firm
Presen t value of
the firm's expected Value of the Firm= Present Value of Expected Future Profits
future net cash
flo\\'S. = '7Tt + 1T2 + . ..+ 'IT,, 1.1
(1 + i)I (1 + 1)2 (1 + /)"
Present Value
\.\'orth in current
dollars.
= I." '7Tt
·-· (1 + ,)'
Here, '7Tt, 1T2, ..., '7T11 represent expected profits in each year, t, and i is the appropriate
interest, or discount, rate. The final form for Equation (1.1) is simply a shor thand
expression in which sigma (l:) stands for 'sum up' or 'add together'. The term
"
I.
I• I
means, 'Add together as t goes from 1 ton the values of the term on the right'. For Equation
(1.1), the process is as follows: Let t = 1 and find the value of the term '7T1 /(1 + i)l, the
present value of year 1 profit; then let t = 2 and calculate '7T2/(1 + i}2, the present value of
year 2 profit; continue until t = n, the last year included in the analysis; then add up these
present-value equivalents of yearly profits to find the current or present value of the firm.
Because profits ('IT) are equal to total revenues (TR) minus total costs (TC), Equation
(1.1) can be rewritten as
Value = ! TR, - TC, 1.2
l•I (1 + l)I
2 Discounting is required because profits obtained in the future arc less valuable than profits earned
presently. One curo today is \'/Orth more than €1 to be received a year from no,,r because €1 today can
be invested andi with interest, g·ro,'i to a larger amount by the end of the year. One euro invested at
10 per cent interest ,,rould gro\'i to €1 .10 in 1 year. Thusi €1 is defined as the present value of €1.10 due in
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The capital city of the Philippine Islands.
See (in this volume)

PHILIPPINE ISLANDS.
MANILA: A. D. 1898 (April-July).

Destruction of the Spanish fleet in Manila Bay.
Blockade and siege.

UNITED STATES OF AMERICA:
A. D. 1898 (APRIL-JULY).
MANILA: A. D. 1898 (July-September).

Capture by the Americans.
Relations of Americans with Filipino insurgents.
General Merritt's report.

UNITED STATES OF AMERICA: A. D. 1898 (JULY-SEPTEMBER).
MANILA: A. D. 1900.
Regulation of the sale of liquors.

PHILIPPINE ISLANDS: A. D. 1900 (SEPTEMBER-NOVEMBER).
MANITOBA SCHOOL QUESTION.

CANADA; A. D. 1890-1896; and 1898 (JANUARY).
MARCHAND'S EXPEDITION.

EGYPT: A. D. 1898 (SEPTEMBER-NOVEMBER).
MARCONI, Guglielmo:
Development of wireless telegraphy.

SCIENCE, RECENT: ELECTRICAL.
MARIANNE ISLANDS:
Sale by Spain to Germany.

CAROLINE AND MARIANNE ISLANDS.
MARITIME CANAL COMPANY.

CANAL, INTEROCEANIC.
MARITIME POWERS.

NAVIES; and WAR BUDGETS.
MARITIME WARFARE, Convention relative to.

PEACE CONFERENCE.
MARRIAGE LAWS, Hungarian.

AUSTRIA-HUNGARY: A. D. 1894-1895.
{303}
MARYLAND:
New election law, establishing a qualification of the suffrage.
A new election law, said to have been driven through the
Legislature by partisan pressure, and for the purpose of
disfranchising the majority of colored citizens, was passed by
both houses on the 20th of March, 1901. It is said to be
"considerably more fair than the North Carolina and similar
laws in States farther south. It disfranchises by means of
regulations which practically make it necessary for a voter to
be able to read his ballot. The illiterate are denied any
assistance when they go into the booths, and all emblems are
omitted from the ticket. The color line is not drawn. It is
believed that there are about 32,000 negroes and 16,000 whites
who will not be able to vote under this law. Practically all
of the negroes are supposed to be Republicans, while it is
estimated that the whites are divided about evenly between the
parties."
MASHONALAND:
Embraced in Rhodesia.

SOUTH AFRICA (BRITISH SOUTH AFRICA COMPANY):
A. D. 1894-1895.
MASSACHUSETTS: A. D. 1897.
Recovery of the original manuscript of Governor Bradford's
History of Plymouth Colony, sometimes called "The Log of the
Mayflower."
"It has long been well known that Governor Bradford wrote and
left behind him a history of the settlement of Plymouth. It
was quoted by early chroniclers. There are extracts from it in
the records at Plymouth. Thomas Prince used it when he
compiled his annals, Hubbard depended on it when he wrote his
'History of New England,' Cotton Mather had read it, or a copy
of a portion of it, when he wrote his 'Magnalia,' Governor
Hutchinson had it when he published the second volume of his
history in 1767. From that time it disappeared from the
knowledge of everybody on this side of the water. All our
historians speak of it as lost, and can only guess what had
been its fate. …
"In 1844 Samuel Wilberforce, Bishop of Oxford, afterward

Bishop of Winchester, One of the brightest of men, published
one of the dullest and stupidest of books. It is entitled 'The
History of the Protestant Episcopal Church in America.' It
contained extracts from manuscripts which he said he had
discovered in the library of the Bishop of London at Fulham.
The book attracted no attention here until, about twelve years
later, in 1855, John Wingate Thornton … happened to pick up a
copy of it while he was lounging in Burnham's book store. He
read the bishop's quotations, and carried the book to his
office, where he left it for his friend, Mr. Barry, who was
then writing his 'History of Massachusetts,' with passages
marked, and with a note which is not preserved, but which,
according to his memory, suggested that the passages must have
come from Bradford's long-lost history. That is the claim for
Mr. Thornton. On the other hand, it is claimed by Mr. Barry
that there was nothing of that kind expressed in Mr.
Thornton's note, but in reading the book when he got it an
hour or so later, the thought struck him for the first time
that the clue had been found to the precious book which had
been lost so long. He at once repaired to Charles Deane, then
and ever since, down to his death, as President Eliot
felicitously styled him, 'the master of historical
investigators in this country.' Mr. Deane saw the importance
of the discovery. He communicated at once with Joseph Hunter,
an eminent English scholar. Hunter was high authority on all
matters connected with the settlement of New England. He
visited the palace at Fulham, and established beyond question
the identity of the manuscript with Governor Bradford's
history, an original letter of Governor Bradford having been
sent over for comparison of handwriting.
"How the manuscript got to Fulham nobody knows. Whether it was

carried over by Governor Hutchinson in 1774; whether it was
taken as spoil from the tower of the Old South Church in 1775;
whether, with other manuscripts, it was sent to Fulham at the
time of the attempts of the Episcopal churches in America,
just before the Revolution, to establish an episcopate here,
—nobody knows."
George F. Hoar,
address, May 26, 1897,
on the Return of the Manuscript to Massachusetts.
After the discovery of the manuscript, several attempts to

bring about its return to America were made: by Justin Winsor,
in 1860, and again in 1877; by Mr. Motley, in 1869; and by
others. At length, Senator Hoar, after delivering an address
at Plymouth, in 1895, on the anniversary of the landing of the
Pilgrims, went abroad, with his interest in the matter warmly
stirred up, and took steps, in concurrence with Ambassador
Bayard, which led to the enlistment of potent influences on
both sides of the sea in favor of the restoration of the
precious piece of writing to its proper home. There were many
difficulties in procuring the necessary legal authority for
the surrender of the manuscript by the Bishop of
London,—difficulties not created wilfully, but by questions
and processes of law; but they were all overcome, with kindly
help from everybody concerned, and, on the 12th of April,
1897, the coveted manuscript book was formally delivered to
the United States Ambassador, Mr. Bayard, for conveyance to
the Governor of the Commonwealth of Massachusetts. It was
delivered by Mr. Bayard in person, on the 26th of May
following, in the presence of the Senate and the House of
Representatives of Massachusetts, sitting together in the
chamber of the latter, with many guests invited for the
occasion. The ceremonies of the occasion included the address
by Senator Hoar from which the above account is taken.
The manuscript volume is now deposited in the State Library of

Massachusetts at Boston. A new edition, carefully reproducing
the text of the history from it, with a full report of the
proceedings incident to its return to Massachusetts, was
printed in 1900, under the direction of the Secretary of the
Commonwealth, by order of the General Court. The following
remarks on the manuscript are from the Introduction to that
edition:
"By very many it has been called, incorrectly, the log of the
'Mayflower.' Indeed, that is the title by which it is
described in the decree of the Consistorial Court of London.
The fact is, however, that Governor Bradford undertook its
preparation long after the arrival of the Pilgrims, and it
cannot be properly considered as in any sense a log or daily
journal of the voyage of the 'Mayflower.' It is, in point of
fact, a history of the Plymouth Colony, chiefly in the form of
annals, extending from the inception of the colony down to the
year 1647. The matter has been in print since 1856, put forth
through the public spirit of the Massachusetts Historical
Society, which secured a transcript of the document from
London, and printed it in the Society's Collections of the
above-named year."
{304}
MASSACRES:
Of Armenians in Constantinople.

TURKEY: A. D. 1896 (AUGUST).
MASSACRES:
Of Chinese by the allied troops.

CHINA: A. D. 1900 (AUGUST 5-16).
MASSACRES:
Of Chinese in Manchuria by the Russians.

MANCHURIA: A. D. 1900.
MASSACRES:
Of Christian missionaries and converts in China.

CHINA:
A. D. 1895 (AUGUST);
1898 (MAY);
1898-1899 (JUNE-JANUARY);
1899;
1900 (JANUARY-MARCH), (MAY-JUNE); and
1901 (MARCH).
MATABELES.
Matabeleland.

SOUTH AFRICA (BRITISH SOUTH AFRICA COMPANY):
A. D. 1894-1895; and
(RHODESIA); 1896 (MARCH-SEPTEMBER).
MATTHEW, The Gospel of:

Discovery of a fragment of an early copy.

ARCHÆOLOGICAL RESEARCH: EGYPT: RESULTS.
MAYFLOWER, The so-called Log of the.
See (in this volume, page 303)

MASSACHUSETTS: A. D. 1897.
MAZET INVESTIGATION, The.

NEW YORK CITY: A. D. 1899 (APRIL-DECEMBER).
MEAT INSPECTION BILL, The German.

GERMANY: A. D. 1900 (MAY).
MEDICAL SCIENCE, Recent advances in.

SCIENCE, RECENT: MEDICAL AND SURGICAL.
MEHTAR OF CHITRAL, The.

INDIA: A. D. 1895 (MARCH-SEPTEMBER).
MEIJI STATESMEN.

JAPAN: A. D. 1900 (AUGUST-OCTOBER).
MENA, The tomb of.

MENELEK II., King of Shoa and Negus of Abyssinia.

EGYPT: A. D. 1885-1896.
MERENPTAH I., The funeral temple of.

MERRIMAC, The sinking of the collier, at Santiago.

UNITED STATES OF AMERICA: A. D. 1898 (APRIL-JUNE).
MERRITT, General: Report of capture of Manila.

UNITED STATES OF AMERICA: A. D. 1898 (JULY-SEPTEMBER).
MESOPOTAMIA, Recent archæological research in.

ARCHÆOLOGICAL RESEARCH: BABYLONIA.
MESOPOTAMIA:
Projected railways.

TURKEY: A. D. 1899 (NOVEMBER); and
JEWS: A. D. 1899.
MEXICAN FREE ZONE, The.
"The Department of State has received through Consul-General

Barlow a report of the Free Zone, compiled by the Secretary of
the Treasury of Mexico, giving a history of the original
creation of the zone and defining its limits, and the
privileges and restrictions applicable thereto. The Free Zone
is a narrow strip of territory extending along the northern
border from the Gulf of Mexico to the Pacific Ocean, with a
latitudinal area of about 12½ miles to the interior, and
embracing a portion of the States of Tamaulipas, Coahnila,
Chihuahua, Sonora, and the territory of Lower California. It
was established many years ago [1861] by the Central
Government, as a compromise or concession to the States
bordering the Rio Grande, as a protection against smuggling
from the United States. The principal cities of the zone are
Matamoras, Camargo, Mier, Guerrero, Laredo, Porfirio Diaz
(Piedras Negras), Juarez, and Nogales. The total population
does not exceed 100,000 people. According to the official
reports, there exist within the limits of the free zone no
industries worth mentioning, which is explained by the fact
that all industrial products manufactured in the zone when
sent into the interior of the country are required to pay the
regular duties charged on imports into the country; and, on
account of the protective tariff of the United States, it is
impracticable to export such products to that country. Thus
the manufacturing industries would have to depend upon the
home consumption, which is not sufficient to maintain them.
All merchandise imported into the zone destined for
consumption therein is admitted on a basis of 10 per cent of
the regular tariff duties, but such merchandise when reshipped
into the interior of Mexico is required to pay an additional
duty of 90 per cent, making, in connection with the 10 per
cent already paid, the regular tariff duty of Mexico. In his
report the secretary of the treasury, Senor Limantour, makes
this statement: 'Many distinguished financiers and eminent
statesmen are opposed to the Free Zone, but all recognize the
fact that, on account of existing circumstances in the
northern frontier, its sparse population, without resources in
agriculture, industry, or mining, the privilege could not be
abolished without compensation, and the problem lies in
choosing some other advantage without prejudice to the rest of
the country.'"
Bulletin of the American Republics,

August, 1898.
"The franchise granted the Free Zone consisted, in the

beginning, in not levying any duty upon imported articles;
afterwards, however, some small duties, purely local, were
established, and the ordinance of 1887 established as a fixed
basis 3 per cent on the value of the duties according to
tariff—a basis which was raised to 10 per cent by the
ordinance of 1891. By subsequent decrees the duties were
raised l½ per cent for the municipality and 7 per cent for
stamps for internal revenue, the result of all this being that
the merchandise introduced into the Free Zone from abroad now
paid 18½ per cent upon the importation duties according to
tariff. … As the records of the frontier custom-houses of the
north make no distinction in the duties, those for the Free
Zone as well as those for the interior appearing in the same
classification, it is impossible to know exactly what the
treasury loses by the 90 per cent rebate on the duties of the
merchandise destined for consumption in the Free Zone; but,
admitting as an exaggerated estimate that the total
consumption of the Free Zone represents in duties $400,000
($177,600) a year, with the 10 per cent charge on this amount,
the average annual loss would be $365,000 ($162,060).
{305}
"The institution of the Free Zone obliges the Mexican

Government, in order to prevent the introduction clandestinely
into the interior of merchandise proceeding therefrom, to
maintain a body of fiscal guards at an annual expense of
$562,525.95 ($249,762). The guards of the custom-houses must
not be reckoned in this account; for these, with or without
the Free Zone, are necessary to prevent the smuggling which
would be carried on from the United States, and which is even
now done. In case of abolishing the Free Zone, it would not be
possible to completely suppress the fiscal guards; lessened in
number and with a distinct organization, they would have to be
maintained, especially since in case of their abolition the
entire duties would be charged (that is to say, 90 per cent
more than is now levied), and this would be inducement enough
to provoke attempts at smuggling. This body of guards, fiscal
as well as administrative, supplies the place of an interior
custom-house (although it does not levy duties), as it reviews
in certain instances the merchandise shipped through the
frontier custom-houses and in a military capacity guards the
roads leading to and from the frontier to prevent smuggling.
It has a system of fixed sections situated at convenient
locations between the Gulf of Mexico and the Pacific, and of
flying detachments continually patrolling the strip of
territory named. Experience has demonstrated the usefulness of
the body, for instances of smuggling by wagons, carts, or
animals can be said to no longer exist."
Of smuggling, "there are two divisions to be made, as follows:

Smuggling to the interior of the Republic and smuggling to the
United State, of America. The first was at one time of
importance, since it was practiced on a large scale. Bands of
smugglers, resorting at times to violence, conducted
merchandise to the interior, but since the Republic entered
the period of peace the Government has been able to take
measures to end this illegal traffic. The custom-houses, which
formerly scarcely produced enough to pay the employees, now
render from $4,000,000 to $5,000,000 annually from import
duties.
"Smuggling from Mexico to the United States of America has

never been practiced to any great extent."
United States Consular Reports,

August, 1898, page 619.
----------MEXICO: Start--------
MEXICO: A. D. 1892-1895.
Boundary surveys.
The international commission which had been engaged since 1892

in resurveying the incorrectly marked boundary between Mexico
and the United States from San Diego, California, to El Paso,
Texas, finished its work in 1895. Another commission began in
the same year to resurvey the remainder of the boundary, along
the Rio Grande from El Paso to the Gulf.
MEXICO: A. D. 1895.
Boundary dispute with Guatemala.
There was a quite serious threatening of war between Mexico

and Guatemala in 1895, consequent upon a disputed boundary
line. The mediation of the United States brought about a
settlement, which gave the disputed district to Guatemala, and
provided for an arbitration of indemnities, the United States
Minister to Mexico being selected as arbitrator.
MEXICO: A. D. 1895.
Census of population.
Its distribution.
"The population of Mexico appears to be, from our … census …

in 1895, 12,570,195, which would give 16.38 for each square
mile; but from my personal knowledge of the country, I am
quite sure that it is not less than 15,000,000. It is very
difficult to take a correct census in Mexico, because there is
not the proper machinery in operation for that purpose, and
especially because a great many districts are inhabited by
Indians, who are impressed with the fear that if they inscribe
themselves in the census they will be taxed or drafted into
the military service, and they try to avoid registration.
"A great many of our people live in such remote districts that
they are practically cut off from communication with other
portions of the country, and in fact are almost isolated; and
this constitutes still another difficulty in the way of taking
a correct census. … The upper lands being the healthiest, most
of the population in Mexico is settled in the central plateau;
a relatively small portion lives in the temperate zone, while
the torrid zone is very thinly populated. I imagine, at a
rough calculation, that about 75 per cent. of the population
make their abode in the cold zone, from 15 to 18 per cent. in
the temperate zone, and from 7 to 10 per cent. in the torrid
zone.
"From the synopsis of our censuses, … it appears that the

population in Mexico has duplicated during the last century,
and although that increase does not keep pace with the
increase in the United States, because this has been really
wonderful, it compares favorably with the increase in other
countries."
M. Romero,
Mexico and the United States,
volume 1, pages 89-90
(New York: G. P. Putnam's Sons).
MEXICO: A. D. 1896.
Amendments to the Constitution.

CONSTITUTION OF MEXICO.
MEXICO: A. D. 1896.
Re-election of President Diaz.
By a popular election held on the 28th of June, 1896, followed

by a vote of "electors" cast July 13, Porfirio Diaz was chosen
President of the Republic of Mexico for a fifth term of four
years, to begin December 1, 1896.
MEXICO: A. D. 1896 (July).

Abolition of inter-state taxes.
The following announcement was reported in May, 1896, by the

United States Consul-General at the City of Mexico: "'All the
States and Territories having approved the amendment to the
constitution prohibiting any interstate tax on commerce
(alcabalas), Congress has passed the bill, the President has
signed it, the Diario Official has published it, and it will
soon be promulgated by "bando." as the Vice-Presidency was the
other day. The law takes effect July 1.' This tax has been in
existence for many years in Mexico, and has been a source of
much embarrassment to internal and external trade. Its repeal
meets with general approval, although some of the States will
be compelled to seek other modes of taxation to replace the
money heretofore obtained by this interstate tax."
United States Consular Reports,

June, 1806, page 354.
{306}
MEXICO: A. D. 1896-1899.
Revolts of the Yaquis.
The Yaquis, one of the native tribes of northwestern Mexico,

taking their name from the river, in Sonora, on which they
dwell, have been in frequent revolt. In 1896, and again in
1899, some of the tribe were fiercely in arms, excited, it was
said, by a religious enthusiast, Teresa Urrea, who claimed a
divine mission and obtained boundless influence over her
tribe, as a saint. She was expelled from the country by the
Mexican government, but stayed on the border, in United States
territory, and continued to stir up hostilities. Though
repeatedly beaten by the government troops, with heavy loss,
their late rising was obstinately persisted in for many
months; but early in 1900 their chief, Tetabiate, was slain,
and a few sharp engagements after that time seems to have
brought the revolt, practically, to an end. A writer in the
California magazine, entitled "The Land of Sunshine" (July,
1899), says of the Yaquis that they are "the backbone of the
population of Sonora. They are the best workmen in the
republic, commanding from 10 to 20 per cent. higher wages in
many localities than Mexican or other Indian labor. There is
not a lazy bone in the Yaqui body. They are a peaceable,
law-abiding people when justly treated. From time immemorial
they have been hunters, miners, and tillers of the soil. They
have the nomad instinct in less degree than almost any other
Indian tribe."
Another writer makes this statement: "There are about three

hundred wild and rebellious Yaqui Indians hidden in the
fastnesses of the Bacatete Mountains, and some thirty thousand
peaceful Yaquis working all over Sonora—among the best workers,
the most successful farmers, and the quietest citizens in the
whole state. … There are few things in the history of the
native races of North America of such absorbing interest as
the career of the Yaqui Indians. The Spanish conquistadores
found them living in this country three hundred and fifty
years ago. They were a strong and stalwart race. Put a Yaqui
by the side of an Iroquois and you can hardly tell them apart.
Put a Yaqui and an Iroquois by the side of any other Indians
in North America, and their physical superiority is seen at
once. Compare them physically with all the other races of the
earth and you will find that they have few, if any, superiors.
The Yaquis were not, however, like their prototypes, the
Iroquois, dependent upon the chase for their food. From the
beginning they were not woodsmen, but farmers. Cabeza de Vaca,
after his long, romantic and perilous journey across the
continent, found great fields of Indian corn waving on the
Yaqui River as far back as 1636. When the early Spanish
missions were established in the Californias they obtained
their supplies from the agricultural Indians in the Yaqui
Valley, and many are the Spanish armies that have been saved
from starvation in times past by the Yaqui corn fields."
W. S. Logan,
Yaqui, the Land of Sunshine and Health,
pages 15, 17.
MEXICO: A. D. 1898.
Completion of the great drainage tunnel and canal
of the City of Mexico.
"Mexico is finishing a great work, the drainage of the valley

where the capital city is located, which has required for its
completion nearly three hundred years and many millions of
dollars, and has cost the lives of hundreds of thousands of
men. … The Valley of Mexico is an immense basin, of
approximately circular shape, with one extreme diameter of
about 60 miles, completely bounded by high mountains, and
having only two or three quite high passes out of it. No water
drains out of the basin. The surface of this valley has a mean
altitude above the sea of 7,413 feet and an area of about
2,220 square miles. Mountain ranges rise on every side, making
a great corral of rock containing dozens of villages and
hamlets, with the ancient capital in the centre. … Evaporation
is so excessive at certain periods of the year that malaria,
consequent on drouth, was far more dreaded by the inhabitants
than the periodical floods, and thousands perished annually,
so that proper drainage was an absolute necessity for the
preservation of health. Nearly fifty years before the
discovery of America, which took place in 1492,
Netzahualcoyotl saw the necessity for a drainage canal, and
commenced the work in 1450." The Spaniards, throughout their
rule, labored at projects to the same end, and sacrificed the
lives of vast numbers of the natives in the work, without much
result.
"Frequent floodings of the old Aztec city and of the Spanish

capital, situated almost at the lowest point of the valley,
were sure to come in times of unusually heavy rains. In early
days, when the Aztecs lived in the middle of Lake Mexico, when
their temples and wigwams were built on piles and the streets
were often only canals, the periodical overflows from the
upper lakes were a matter of small concern, though even then
the Nahua engineers were called upon to protect the city by
dykes. But when by evaporation, by filling in at the site of
the city, by lessened waters, due to the fissures caused by
earthquakes, Lake Mexico had disappeared, and the city had
come to be built on the spongy soil, above all, when the
short-sighted choice of Cortez had been confirmed and the
capital of New Spain had come to stand on the ruins of the
Aztec town, increasing rapidly in population and wealth,—it
became a serious matter that on an average of once in
twenty-five years the streets should be from two to six feet
under water for an indefinite time. …
"In 1866 the works now [1895] nearing completion were

commenced. A project proposed by Señor Don Francisco de Garay,
a well-known engineer of the city of Mexico, was pronounced
the most feasible. But the revolutionary struggle succeeded,
and for many years the work was relegated to the background. …
The present gigantic work cannot have been considered to have
been seriously undertaken, with a view of completion at any
cost, until the year 1885, when the City Council of Mexico
submitted a project to the Government to which they offered to
contribute largely in the event of its being adopted. A
special commission, with ample authority to deal with the
funds set aside for the work, was appointed by President
Porfirio Diaz. …
"The drainage works, when carried out, will receive the

surplus waters and sewage of the City of Mexico and carry them
outside of the valley, and will also control the entire waters
of the valley, affording an outlet, whenever found necessary,
to those which might otherwise overflow fields and towns,
rendering the soil stagnant and marshy. The work consists of
three parts—1st, the tunnel; 2d, a canal starting from the
gates of San Lazaro, and having a length of 47½ kilometres, or
43 miles; … and 3d, the sewage of the City of Mexico. …
{307}
As this paper goes to press, the drainage works of the Valley
of Mexico are practically finished, as the waters of the
valley have been for several years passing through the canal
and the tunnel to their outlet in the river which takes them
to the Gulf of Mexico, and the company with whom the canal was
contracted is now giving the finishing touches to the sides
and bottom of the canal and will deliver it to the Government
Board of the Drainage Directors in January, 1898. …
"The canal and six-mile tunnel through the mountain range have
a total length approaching 37 miles. The present works will
take rank with the great achievements of modern times, just as
the immense 'cut' of Nochistongo, their unsuccessful predecessor,
was the leader among ancient earthworks in all the world. The
completed system will have cost $20,000,000."
M. Romero,
Mexico and the United States,
pages 266-280
(New York: G. P. Putnam's Sons).
MEXICO: A. D. 1898-1900.
The results of twenty years of the presidency of Porfirio Diaz.
The wonderful advance of the Republic.
In his interesting book on Mexico, entitled "The Awakening of

a Nation," written in 1898, Mr. Charles F. Lummis expresses
the opinion that, under the Presidency of Porfirio Diaz, that
country "has graduated to be the most compact and unified
nation in the New World"; that "she has acquired not only a
government which governs, but one which knows how to govern—
and contemporaneously a people which has learned how to be
ruled"; and he characterizes its government as "logical
paternalism—a scheme frightfully dangerous under a bad father,
incalculably beneficial under a good one." Two years later, in a
contribution to an elaborate "Review of the Nineteenth
Century," by many writers, which was published by the "New
York Evening Post," January 12, 1901, Mr. Lummis wrote:
"Before Diaz, the rich and ancient capital had spent two and a
half centuries and ten millions in vain attempts to relieve
its recurrent Hoods. Sewerage was unknown. Today the valley is
drained and sewered by a system nowhere surpassed. Electric
lighting, transit, and power-transmission are in vogue. Law
and order are of a proportion we may well envy. Public
education and individual scholarship have no call to blush in
any fair comparison with any land. Business is prosperous,
almost without individual exceptions. Factories of all sorts—
and some of the costliest and finest factories in the
world—have sprung up by the thousand. The comminuted bones of
a national spirit have knit as they never were before.
Nowadays, it is not Mexico, but we, who are 'fooled' when we
omit her from the category of the nations that count. She does
count; she will count far more. She has mastered anarchy, she
has triumphed even over free silver. She is busily engaged in
practising one of the first gospels and mottoes of the
American colonies—'Mind Your Own Business'—and is making a
magnificent success at it. It is a curious problem in the
philosophies of history, what shall be the outcome of a nation
which instead of being born rugged and growing old and easy, was
born old and in the last quarter-century has come into the
heritage of sturdy youth. For it is as a young nation, with
muscles still growing, that we must think of new Old Mexico."
Honorable John W. Foster, writing to the "New York Tribune,"

on the 9th of January, 1901, from the City of Mexico, where he
formerly resided for some years as United States Minister, has
borne similar testimony to the astonishing progress of the
country. "Since the advent of General Porfirio Diaz to power
in 1876," writes Mr. Foster, "there has been no foreign war
and no serious disturbance of an internal character, the only
exception being the outbreak of certain semi-independent
Indian tribes. In the previous fifty years of the existence of
the republic there had been as many presidents, the majority
of whom owed their existence to revolutionary movements. The
wretched story of Mexican history of that period is too

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Managerial Economics 14th edition

Transitive Property, 54 • Commutative Properties, Determinants of Demand, 79 • Industry Demand Vers11s

Part 2: Demand Analysis and Estimation 109

Chapter 1t: Demand Analysis SH Price-Consumption Curve, 122 • lncome-

Graphiug the Market Demand Curve, 163 Exponential Smoothing 212

Tests of Predictive Capability, 220 • Correlatio11 Questions 224

Part 3: Production and Competitive Markets 237

Managerial Application I 0.2: Seasonality Role for Government 410

Chapter 11: Performance and Strategy

Part 4: Imperfect Competition ltltS

Managerial Application 12.1: The EU Monopoly Underproduction, 453 • Dendweight Loss

Monopoly Regulation 458 Oligopoly 498

Infinitely Repeated Games 545 Price Discrimination Example 580

Part 5: Long-Term Investment Decisions 617

r THIS UfTH EDITION

Buffett's success is powerful testimony to the practical usefulness of managerial economics.

r HOW IS MANAGERIAL ECONOMICS USEFUL?

Evaluating Choice Alternatives

Figure 1.1 Managerial Economics is a Tool for Improving Management Deosion-Making

Management Decision Problems

Economic Concepts Quantitative Methods

Managerial economics identifies ways to achieve goals efficiently. For example,

resources. By following these rules, businesses, nonprofit organizations and government

Making the Best Decision

rTHEORY OF THE FIRM

Expected Value Maximization

See (in this volume)

MANILA: A. D. 1898 (April-July).

See (in this volume)

MANILA: A. D. 1898 (July-September).

See (in this volume)

See (in this volume)

MANITOBA SCHOOL QUESTION.

See (in this volume)

See (in this volume)

See (in this volume)

See (in this volume)

MARITIME CANAL COMPANY.

See (in this volume)

See (in this volume)

MARITIME WARFARE, Convention relative to.

See (in this volume)

MARRIAGE LAWS, Hungarian.

See (in this volume)

See (in this volume)

"In 1844 Samuel Wilberforce, Bishop of Oxford, afterward

"How the manuscript got to Fulham nobody knows. Whether it was

After the discovery of the manuscript, several attempts to

The manuscript volume is now deposited in the State Library of

See (in this volume)

See (in this volume)

See (in this volume)

See (in this volume)

See (in this volume)

MATTHEW, The Gospel of:

See (in this volume)

MAYFLOWER, The so-called Log of the.

See (in this volume, page 303)

See (in this volume)

MEAT INSPECTION BILL, The German.

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MEDICAL SCIENCE, Recent advances in.

See (in this volume)