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What is an example of a firm which, one might argue, is experiencing either (a) economies of scale, or alternatively (b) diseconomies of scale. What are the advantages or disadvantages the firm in question seems to receive when its scale of operations increases, what are the effects of these things, and why do you think they occur? Make sure you are explicit in your answer about the time period (short term or long term) during which economies or diseconomies of scale appear, explain what economies or diseconomies of scale are, and suggest a reason why one or another of them might be occurring.
When a perfectly competitive firm is producing at its profit maximizing level of output, its MR is equal to price and its MC while it may or may not be making an economic profit. The price a profit maximizing monopoly charges is always greater than i..
Loan amortization and EAR You want to buy a car, and a local bank will lend you $35,000. The loan will be fully amortized over 5 years (60 months), and the nominal interest rate will be 11% with interest paid monthly. What will be the monthly loan pa..
A TV manufacturing company estimates that when TVs are sold for x dollars a piece, consumers will bu 8000/x TVs each week. The company also determines that profit is maximized when the selling price x is 1.4 times the cost c of producing each unit. H..
Suppose there is a firm with two inputs of production, labor (L) and capital (K), with associated prices w and c, respectively. Also assume that the firm faces competitive input and product markets and that the two inputs are gross substitutes in pro..
An indifference curve involving two goods identifies the:
If variability of data in a time series increases overtime
How do these tools (payoff tables and game forms) help decision-makers to avoid incomplete thinking and over- inclusive thinking in their judgments?
Marko, Inc. is considering the purchase of ABC Co. Marko believes that ABC Co. can generate cash flows of $5,200, $10,200, and $16,400 over the next three years, respectively. After that time, they feel the business will be worthless. Marko has deter..
What could be done to motivate people to spend more so as to increase aggregate demand and invariably, create employment possibilities.
How do externalities in the production of electricity result in market failure?
A local hardware store is trying to decide whether to stay open. They have found that their industry is extremely competitive and profits have shrunk considerably. Knowing that you have taken an economics course, the owners have asked for your opinio..
Sketch graph a standard short-run production function, and identify on it the points where the average product peaks, the marginal product peaks, and the marginal product reaches zero, and the average and marginal product intersect.
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