Q1) Explain how each of the following will affect the market for crude oil. Make sure you highlight whether supply or demand is affected and whether price will rise or fall. If possible illustrate each answer with a diagram.
Case 1. The government subsidizes the transition to vehicle powered natural gas.
Case 2. Job growth remains poor for several years.
Case 3. A new technology makes it cheaper and safer to explore deep sea bed reserves.
Q2) Explain the profit maximization condition of a business. What is normal versus supernormal profits? If a small business makes normal profits does it mean the owner does not get paid?
Q3) What are some reasons that would justify the intervention (regulation, taxation, etc) of government in the economy?
Q4) You are the CEO of a multinational corporation which wants to invest in India. What are some risks you will face? How would you mitigate them?
Q5) BONUS (optional) question for extra credit: What will be some of the consequences if Congress fails to raise the US debt ceiling?