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It has been proposed that toll collection on the Massachusetts Turnpike, a key commuter route into Boston from the west, be discontinued. Proponents argue that tolls have long ago paid for the cost of building the road; now they just provide cash for tax bureaucracy. A number of economists are opposing the repeal of tolls on the grounds that they serve to internalize externalities. Explain this argument and discuss why the government often gets involved when finding solutions for externalities.
Lambert-Rogers Co. is a manufacturer of petrochemical products. The firm's research efforts have resulted in the development of a new auto fuel injection cleaner that is considerably more effective than other products on the market.
Imagine that you are trying to value a particular piece of wilderness that people use for recreational hiking and cycling. While this area has no entrance fee, statistics have been kept on who visits and how frequently they visit the area.
Suppose that in response to a foreign crisis, the goverment increases defenst spending to $50 billion. How would the increase in defense spending affect the economy How would the effects differ depending on the size and sign of the output gap when..
Smart University of Lafayette Indiana is a C.E.D. division of Smart University located in Gary Indiana. SU's goal is to maximize profits.. SU is currently maximizing the profit at SU of Lafayette by charging the profit-maximizing tuition rate. T..
explain why long distance phone service was originally a natural monopoly, how did the growing number of satellites change the cost structure of the long distance phone service, why might it be efficient to have competition in long distance phone ..
Will firms in industries, in which high levels of output are necessary for minimum efficient scale, tend to have substantial degrees of operating leverage? Please explain.
Using the results obtained above, derive a table for the long run costs of the various levels of production of sweaters (10, 20, 30, 40). The table should show: quantity, total cost, average cost and marginal cost.
How do costs play into your everyday life For example, why might it be cheaper to drive on a toll-road vs. a free-access interstate? Also, can you identify situations where you may fall victim to the sunk cost fallacy (we all do)
Federal antitrust enforcers are investigating whether a multinational pharmaceutical company has attempted to minimize the impact of generic competition to one of its most profitable prescription drugs.
Nobel Laureate Robert Fogel of the University of Chicago has argued, "Expenditures on healthcare are driven by demand, which is spurred by income and by advances in biotechnology that make health interventions increasingly effective." If Fogel is ..
Calculate the control costs under the tax policy and compare their total to that achieved under the command and control policy in (d). Which policy is more cost effective? Why do you expect this finding to be true in general?
For which types of business organization is unlimited liability going to apply to - a sole proprietorship, a partnership or a corporation? Now explain out of those business organizations, for which one will unlimited liability be the greatest prob..
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