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Assume the United States government determines that the cigarette smoking creates social expenses not reflected in current price of cigarettes in the market. A study has recommended that government can correct for the externality given the effect of cigarette consumption by paying farmers not to plant tobacco used to manufacture cigarettes. Assuming that the government is correct that cigarette smoking creates external costs, evaluate where the study’s recommended policies might help correct this externality. Why does the presence of externalities not reflect society’s costs and benefits in the market? Why are markets considered to fail the appropriate allocation of resources that are needed in the market? When answering the question, make sure to evaluate it from the different stakeholders that are present in the market.
Provide the key provisions of the tax cuts passed through Congress in spring 2003 and explain how would these tax cuts be represented by the aggregate expenditure model and the IS curve
Elucidate if our current U.S. economic conditions are more consistent with the Keynesian or classical economic theories.
Assume that the soft coal industry is a competitive industry and it is in long run equilibrium. Now assume that the firms in the industry form a cartel.
Fed Chairman Ben Bernanke finally confess that the Fed has been printing more new currency over last some months to help stimulate the economy and more recently noted economy may not yet be out of woods,
Suppose that the airplane can be purchased from an outside supplier. What is the relevant unit cost for this make-or-buy decision.
Determine the basic assumption about the velocity of money transforms the equation of exchange into the quantity theory of money?
Determine what are economic decisions made in tradition, command and market economies and what are the pros and cons of each?
Draw a diagram describing autarky and a pattern of comparative advantage for your example.
Assume if the inflation rate is 5percent is this still acceptable. Provide quantitative justification for your answer.
Illustrate is the relationship among the variable that you selected and the economy. What trends do you see in the data sets. Support your assertions of trends with statistical evidence.
Suppose that the car manufacturer allows the car dealer to return all unsold cars at the end of a recessionary year. What is the car dealer's profit in a growth year and in a recession? What is their expected profit?
Illustrate Wwat could it or should it have done differently. Please provide references to support your position.
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