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Given that it takes 5 yards of textile to make a suit whose free trade price is $150.00 and that the textile sells for $20.00 per yard. Calculate (i) the NRP and the ERP if the government is to impose a $30.00 tariff per suit and (ii) what happens to the ERP once a 40% tariff on textiles is added to the tariff structure.
Two countries, France and the US produce just one good – chicken. Suppose that the price of beef in the US is $2.80 per kilogram, and in France it is 3.70 EURO per kilogram. According to PPP theory, what should be the $/EURO spot exchange rate? What..
What role do the measurements of unemployment and inflation have on the management of an organization?
Firm A is the incumbent in a market and currently enjoys a monopoly. Firm B is a potential entrant. The demand in this market is p = 6 - (qA + qB), where p is the industry price of output. Both firms produce output costlessly.
What is the paradox of thrift? Is Saving Good or Bad? Is it real? Give an example of the paradox of thrift.
Why might European Monetary System provisions for the extension of central bank credits from strong-to weak-currency members have increased the stability of European Monetary System exchange rates?
When entry occurs in a monopolistically competitive industry,
Calculate the own price elasticity of demand for the demand curve P= 15-3X at prices and compare the outcomes.
Suppose a society decided to reduce consumption and increase investment. How exactly would this change affect long term economic growth?
What happens to price and output in the Cournot, Bertrand, and Stackelberg models if marginal costs increase by 10 percent? The market demand is p = a-bQ and the marginal cost is constant across firms, i.e. mc1 = mc2 = c. You may consider for two fir..
Financial statements are a major source of information about a company. Forecasts, reports, and recommendations from analysts are popular alternative sources of information. Discuss the strengths of financial statement information for business decisi..
A cost-effective policy is always socially efficient. Enforcement costs are critical to the success of environmental programs and should be included in the overall social costs of the program when evaluating different policy options.
Are innovative product and service offerings ethically neutral? Consider Napster and the intellectual property issues associated with swapping music over the Internet as an example to begin the discussion.
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