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Karen's money income is $180, the price of X is $3, and the price of Y is $1.5. Given these prices and income, Karen buys 40 units of X and 40 units of Y. Call this combination of X and Y bundle C. At bundle C, Karen's Marginal Rate of Substitution between X and Y is 1/2. Is Karen maximizing her satisfaction level at bundle C? Explain. If not, how should Karen change her consumption to maximize her satisfaction level?
Assume there are two players in an oligopoly, playing repeated Cournot competition (that is, they compete on quantity). The demand in each year is p= A-by. Each player has discount rate r. Find strategies that lead to a sub-game perfect equilibrium w..
Consider now an economy where you need to search for a job. Let b be the fraction of people that do not have a job and are searching for one. Write the equations describing the dynamics of those employed (E) and those who are not employed (NE). Compu..
Elucidate however, in checking with government economists, Hanna finds that every capita disposable income is expected to rise.
Traditional brick and mortar retail stores are losing their customer base while their online competitors are seeing phenomenal increase in the number of customers. Examine the differences and similarities (where possible) in the two modes of retail i..
Corporate officers in the United States are subject to high accountability standards and harsh penalties under the _____ Act.
Suppose in the Cournot model that the firms have different production costs. Let c1 and c2 be the costs of production per unit for firms 1 and 2 respectively, where both c1 and c2 are assumed less than 1/2. Find the Cournot equilibrium.
Loyalty programs are more the norm than the exception. Once all competitors offer similar schemes, all that happens is that marketing costs have risen in that industry. Argue for or against the proposition that loyalty programs are effective customer..
Tara is considering leaving her current job, which pays $85,000 per year, to start a new company that manufactures a line of special pens for personal digital assistants. What are Tara’s accounting costs? Are there other costs that Tara should consid..
Create two separate graphs that show current changes in equilibrium interest rates using the MD and MS curves. Describe the following: The Fed's actions to fight recession, The Fed's actions to lower inflation. Describe the transmission process of mo..
Suppose you decided to open a copy store. You rent store (signing a one year lease),and you take out a loan at the local bank and use the money to purchase 10 copiers. Six month later a large chain opens a copy store two blocks away from yours
If you wanted to assess the competitiveness of a country, would you focus on its spot exchange rate, its real exchange rate, its effective exchange rate, or some other measure of the company's currency's value? Explain
barbers who have turned farmers will drive down wage rate but will still be earning more than if y had remained barbers. Who benefits from technological progress in farming Farmers or barbers.
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