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El Paso Water Utilities (EPWU) purchases surface water for treatment and distribution to EPWU customers from El Paso County Water Improvement District during the irrigation season. A new contract between the two entities resulted in a reduction in future price increases in the cost of the water from 8% per year to 4% per year for the next 20 years. If the cost of water next year (which is year 1 of the new contract) will be $260 per acre-foot, what is the present worth of the savings (in $/acre-ft) to the utility between the old and the new contracts? Let the interest rate equal 10% per year.
Arguments in favor of having developing countries focus on exporting manufactured goods include
Who benefits from a tariff or quota. Who loses. Illustrate what are positives and negatives of protectionist trade policies on federal government's part. Which policy is best right now.
The Midterm Exam is open book, open notes. The maximum time that you can spend in the exam is three hours. If you have not clicked the Submit For Grade button by then, you will be automatically exited from the exam. In the exam environment
Illustrate what price do you think this firm should charge if it wants to maximize its short-run profit.
One critic of the North American Free Trade Agreement argued that "it can't be in our interest to sign this deal; Mexico gains too much from it." What does the theory of the gains from trade have to say about that criticism?
The existing equipment will be sold for $6,000. Illustrate what is the first cost that should be used.
Paula has set aside $60 monthly budget to attend plays and watch movies. She likes plays exactly three time as much as she likes movies. Draw her indifference curves. If the price of movies decreases to 4 dollars how many movies will she see?
Suppose V=$0, what is Jim's labor supply function now. Draw his labor supply curve. Illustrate what happened to his wage and substitution effects.
Illustrate what is the company's pretax cost of debt.
Panel B shows how the demand for X shifts when the price of related good Y increases from $60 to $68. Use the information in Panel B to calculate the cross-price elasticity. Are goods X and Y substitutes or complements?
What is the importance of an efficient forecasting demand for a product and its relationship with economic gain?
In equilibrium, what is the price and quantity of toasters? What kinds of toasters are bought and sold and which option will a low-quality producer choose
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