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One assumption of the supply and demand model is that all goods that are bought and sold are identical. Why do you suppose economists commonly make this assumption? Does the supply and demand model lose its usefulness if goods are not identical?
The short-run production function of a profit maximizer firm is given by f(L) = 6L^2/3 , where L is the amount of labor it uses. The cost per unit of labor is w = 6 and the price per unit of output is p = 3. (i) How many units of labor will the firm ..
Which one of the following basic findings about for-profits is not true? Below is the list of the most important risks an investor must evaluate when projecting an HMO’s profitability. Which option does not belong to this list? Agency problems would ..
If expected inflation is constant and the nominal interest rate increased 5 percentage points, what would happen to the real interest rate?
You work for the American Red Cross as a Health Economics consultant in the Boston area. You are told to guess the correlation between snow damage to houses during the winter storms last year and the median price of the house. Describe the difference..
terrorist attacks on the World Trade Center and the Pentagon affected short and/or long-term productivity in the United States. Explain your response and show any movements in the PPF.
.S. policy to increase the miles per gallon (mpg) of new cars is to mandate an average mpg for cars sold by U.S. manufacturers. In many countries within the European Union, the policy is to tax gasoline so that the price per gallon at the pump is sta..
"High salaries are essential if we are to have the most capable students pursuing medical careers" Comment- Why or why not?
What additional programs did the Fed create and implement to facilitate its role as leader of last resort? What was the primary purpose of these new programs?
The U.S. money supply (M1) at the beginning of 2000 was $1,148 billion broken down as follows: $523 billion in currency, $8 billion in traveller’s checks, and $616 billion in checking deposits. Suppose the Fed decide to reduce the money supply by inc..
Discuss the role of the FOMC and the three major policies it implements to help regulate banks. Briefly describe the equation used to measure bank reserves and the definition of the federal funds rate and their role as operating targets of the Federa..
The classical dichotomy and the neutrality of money The classical dichotomy is the separation of real and nominal variables. The following questions test your understanding of this distinction. Megan spends all of her money on comic books and beignet..
Compute the HHI index for each of the following industries. Which industry is the most concentrated. An industry with five firms that have the following market shares.
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