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At the intersection of the short run aggregate supply curve (SAS), the aggregate demand curve (AD), and the long run aggregate supply curve (LAS) all occurring at the same point, the economy is:
A. in a short run equilibrium but not a long run equilibrium.
B. in a long run equilibrium but not a short run equilibrium.
C. in both a short run and long run equilibrium.
D. in neither a short run nor long run equilibrium. Review
NPV and IRR: Under which circumstances can the NPV and IRR calculations lead to conflicting results? Differences: What is the major reason for the difference? Preferable Methods: Which of the two methods is preferable? Why? Use examples and plots wit..
Assume that the consumer has $10 to spend on A and B; that is, x + y = 10. What is best way to allocate the expenditure of the $10? What is the marginal utility per dollar in the optimal allocation?
If all n identical firms in a market belong to a cartel, how much total output will be produced relative to the monopoly output, and how much will each firm produce?Suppose the graph on the next page depicts the demand for football tic k ets at Gr..
Explain the elements of the estate tax formula. Describe the interplay between gift and estate taxes. Describe strategies to minimize estate taxes. Explain the generation-skipping transfer tax and its relationship to gift and estate taxes.
Karen runs a print shop that makes posters for large companies. It is a very competitive business. The market price is currently $1.00 per poster. She has fixed costs of $100.00. Her variable costs are $1,500 for the first thousand posters, $1,200 fo..
As additional units are produced, the marginal revenue product falls for all firms because marginal product decreases. For firms operating in industries that are not perfectly competitive, marginal revenue product also falls because
A life insurance salesperson claims the average worker in the city of Cincinnati has no more than $25,000 of personal life insurance. To test this claim, you randomly sample 100 workers in Cincinnati. You find that this sample of workers averages $26..
What steps can a government take to ensure that sustainable development is always considered in assessing which major economic projects or investment proposals to accept.
A government starts off with a total debt of $3.5 billion. In year one, the government runs a deficit of $400 million. In year two, the government runs a deficit of $1 billion. In year three, the government runs a surplus of $200 million. What is the..
On a specific plot of land, X = 20L1/2 ; where X is the level of output in bushels of wheat, and L is the number of workers hired. Assuming that each worker receives a real wage equal to 1 bushel of wheat, calculate the maximum rental value of the la..
Illustrate what is the average value of a loyal customer (VLC) in a target market segment if the average purchase price is $50 per visit, the frequency of repurchase is 12 times per year.
Compute the changes in consumer surplus, producer surplus, government revenue and third party surplus. Also, show these changes on a graph.
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