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Long-run real interest rates are expected to increase. An accountant and an MBA student (who just finished his course ofManagerial Economics) where interviewed regarding the effect on the firm they both work at. Keeping all else constant, their answer would likely differ. How do you guess the interviewed will answer? Does the difference in response matters? If yes, why? If not, why not?
(a) Indicate whether this production function exhibits constant, increasing, or decreasing returns to scale. (b) Does the production function exhibit diminishing returns If so, when does the law of diminishing returns begin to operate.
The inspection equipment has a 6-year useful life and no salvage value. Use a nominal 18% interest rate in your calculations. How much can Robot afford to pay for equipment if the wages and worker benefits were to have been paid monthly?
In early 2001 investment spending sharply declined in the United States. In the 2 months following the September 11, 2001, attacks on the United States, consumption also declined. Use AD-AS analysis to show the two impacts on real GDP.
Explain what factors would increase the supply (shift the supply line to the right) of a manufactured product like white bread and what factors would cause a decrease in demand (shift of the demand curve to the left) for that same product.
Suppose the airline is offered $4,000 per week to haul freight along the route for a local firm. This will mean replacing one of the weekly passenger flights with a freight flight (at the same operating cost).
How does an expansionary monetary policy work? (Describe the steps through which an increase in money supply affects the real GDP). How does fiscal policy work? (Describe the steps through which an increase in G or TR, or a decrease in TX, affects ..
In the 1990s, five firms supplied amateur color film in the United States: Kodak, Fuji, Konica, Agfa, and 3M. From a technical viewpoint, there was little difference in the quality of color film produced by these firms, yet Kodak's market share wa..
Suppose you are asked to address a professional meeting and explain microeconomics, macroeconomics and their differences.
Is the following statement correct or incorrect: "If a firm operating in a monopoly or imperfectly competitive industry is trying to maximize profits, it will always charge the highest price that the traffic will bear." Explain why or why not.
In the 1970s, the United States federal government created a Department of Energy. This is a time when the OPEC (Organization of Petroleum Exporting Countries) cartel first became prominent. Identify how this action might have impacted the three m..
Kimberly MacKenzie, president of Kim's Clothes Corporation, a medium-sized manufacturer of women's casual clothing, is worried.
Answer the following questions on the basis of the monopolist's situation illustrated in the following graph.
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