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Suppose a perfectly competitive, increasing-cost industry is initially in long-run equilibrium and demand suddenly increases. Explain how the demand change affects price and quantity and who benefi
Suppose that a firm produces 200,000 units a year and sells them all for $10 each. The explicit costs of production are $1,500,000 and the implicit costs of production are $300,000. The firm has an
Write a 350- to 500- word paper in which you relate the concepts in this week's readings to a prior real world experience. The experience does not necessarily have to be work experience. Discuss th
We can use the asset approach to both make predictions about how the market will react to current events and understand how important these events are to investors. Consider the behavior of the Unio
Draw the normal form for a second-price sealed-bid auction. The set of strategies for each player should include $0,$2,$4,and $6. Solve the game (in other words, find the optimal bidding strategy fo
Explain why government deficits in more troubled countries, such as Zimbabwe or Iran, tend to produce more inflation than deficits in less-troubled countries, such as Japan or the United States.
Explain why, despite governments' always financing their budget deficits by selling bonds, in some cases those deficits are in their effects are financed by printing money?
Consider the econ of Opulenza. In Opulenza domestic investment was 400 milion and there was 20 million in capital gains or domestic wealth during 2007. Opulenzas purchased 120 million in new foreig
To meet the needs of its own citizens at their current level of consumption, industry-land needs 200 units each of raw materials, agriculture products, and manufactured goods. the total opportunity
What price and output will occur under pure competition? What price and output will occur under pure monopoly (assume one price is charged to all customers)?
An economy is in long-run macroeconomic equilibrium when each of the following aggregate demand shocks occurs. What kind of gap -inflationary recessionary- will the economy face after the shock, and
Suppose the Swiss franc rises against the British pound but falls against the Japanese yen. What happens to the prices of goods imported into Switzerland?
Determine the quantity in each market and maximum possible total profits if the firm engages in perfect price descrimination?
One of the most important skills to learn in managerial economics is the ability to identify a good business. Discuss at least four characteristics of a good business.
A government budget deficit is financed by a combination of
Domestic producers often base their claim for import protection in the fact that workers in country X are paid substandard wages. Is this a valid argument for protection? Can you give examples of
Suppose we refused to sell goods to any country that reduced or halted its exports to us. Who would benefit and who would lose from such retaliation? Can you suggest alternative ways to ensure imp
What are the differences and similarities between the investment multiplier and a consumption multiplier? How is the mpc different than the multiplier? Explain what is the use of each one in the ec
Advocates of using budget surpluses to bolster the social security trust fund say that:
If the MPP of labor is 60 and the price of labor per period is $20,the MPP of machinery is 75 and the price of the machinery per period is $25, in order to achieve optimal input poportions the firm
A soft drink producer must decide how to divide its spending between two forms of media: TV advertising and magazine advertising. Each 30 second commercial on prime time network TV costs $120,000 an
Determine (solve for) the equilibrium level of income or GDP (Y). Determine the impact on income of a 50 increase in government spending from 250 to 300. Using the original data, compute the impact of
Consider the following multiplicative demand function where QD = quantity demanded, P = selling price, and Y = disposable income:
Wealth is redistributed from creditors to debtors when inflation was expected to be:
Now suppose the economist allow for crowding out. Would their new estimate of MPC be larger or smaller than their initial one?