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Approximately 14 million Americans are addicted to drugs and alcohol. The federal government estimates that these addicts cost the U.S. economy $300 billion in medical expenses and lost productivity. Despite the enormous potential market, many biotech companies have shied away from funding research and development (R&D) initiatives to find a cure for drug and alcohol addiction. Your firm – Drug Abuse Sciences (DAS) – is a notable exception. It has spent $280 million to date working on a cure, but is now at a crossroads. It can either abandon its program or invest another $75 million today. Unfortunately, the firm’s opportunity cost of funds is 8 percent and it will take another five years before final approval from the Federal Drug Administration is achieved and the product is actually sold. Expected (year-end) profits from selling the drug are presented in the accompanying table.
Lisa is a self-employed physical therapist who works from a rented space. Lisa charges $250 for a therapy session. She incurred the following costs last month: space and equipment rental, $1400; wages, $3500; materials, $1800. If Lisa’s profit last m..
Money is defined by economists as "anything generally accepted as payment" For each of the following sentences, explain why it does not use the economist’s definition of money: Write a sentence that does use the economists definition of money
How does this change the value generated by the market? Why do you say this? Where does this appear in your graph.
“But in real-life America, and especially in the America of railroad men and new industrialists, laissez-faire was a dangerous idea” Explain. The giant modern corporation did more than transform business into finance. It displaced classical ideas abo..
Describe perfect competition and long-run equilibrium. Provide detailed descriptions, definitions and concrete examples of your findings.
In the area of National Supremacy the Supreme Court:
As the manager of smith construction you need to decide on the number of homes to build in a new residential area where you are the only builder. How many homes should you build and what profits can you expect.
Suppose each monopolist is allowed to sell both domestically and export the good. At what price will the good be traded? What quantity will each firm sell domestically and what quantity will it export?
Select a Government Regulation. Identify a particular government regulation of your choosing that in your opinion has either been successful or a failure. Briefly state the original purpose of this regulation and whether it has changed over time. The..
Suppose the price level and value of the U.S. dollar in year one are 1 and $1.00, respectively. If the price level rises to 1.25 in year two, what is the new value of the dollar? If, instead, the price level falls to 0.50, what is the value of the do..
The radio manufacturing industry has been in decline for quite some time. Suppose the government is called on to save this industry with infusions of cash, low interest loans, or other special breaks. This might be touted as helping firms remain open..
Consider a city where a new automobile factory is scheduled to open. The factory will employ 1,000 people, and the city's employment multiplier for the automobile industry is 2.5. The city's elasticity of labor supply is 1.8, and its elasticity of la..
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