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Consider Bob, he washes his car by hand rather than taking it to the local car wash. When asked why he washes it by hand, Bob explains "you should never pay for something you can do yourself." Evaluate the validity of Bob's statement, especially in terms of absolute andcomparative advantage.
Explain the relationship between the Magpie and the Eagle and explain what would be the effect of a 10% increase in the income of the target market have on the demand for the Magpie
Externalities are 3rd-party consequence of some other action. They can be positive or negative externalities and they impose a benefit or cost to a 3rd-party.
Why does an initial $400 billion annual decrease in consumption spending make income fall by more than $400 billion per year. Explain why an initial change in planned aggregate expenditure results in a much larger change in equlibrium income.
A permanent endowment at the University of Alabama is to award scholarships to engineering students. The awards are to be made beginning 5 years after the $10 million lump-sum donation is made
Ongoing United States struggles in Iraq and Afghanistan, political unrest in South America, and civil wars in Africa have driven crude oil values up for the last many years.
Choose a market for a good in your area that seems to be a perfectly competitive market. Write four or five substantive paragraphs that describes the market and answers the following questions: Identify the buyers and sellers as well as the goods o..
Suppose the market discount rate is 20% instead of 5%. Should he now charge the limit price to deter entry or accept the entry? Assume his goal is maximize the PV of long-run profits.
A competitive market is intended to result in improved efficiency, though it will not necessarily improve equity. That is, a competitive market might encourage efficient production but may not necessarily result in a redistribution of wealth
Recently, Pfizer and Warner-Lambert agreed to a ninety billion dollar merger, thus creating one of the world's biggest pharmaceutical firms. Pharmaceutical firms tend to expend a greater percentage (%) of sales on R&D activities than other industries..
The highest quantity of lobsters demanded and what is the marginal net utility (consumer surplus) when the market price is $ 4.00 per lbs. why?
Give a numerical example to show that a monopolist's marginal revenue can be upward-sloping over part of its range. Hint: The price on the demand curve is the producer's average revenue. Think of the graphic that showed the possibility of declining..
Draw the game as a table. What are the Nash equilibria of this game? How does this game differ from a prisoner's dilemma, and how can participants achieve the optimal (both hunt Stag) outcome?
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