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What are the strengths and weaknesses of game theory? What are its underlying assumptions? Devise a situation/scenario from your work (or another company in which you are familiar) in which game theory is immediately applicable. Sketch out its specific use from beginning assumptions, to logical behavior and to policy conclusions.
What is the impact of opening trade on the real rental on capital.
Increasing the minimum wage will result in a decrease in employment for workers who now earn less than the new minimum wage.
Use commercial bank and Federal Reserve Bank balance sheets to demonstrate the immediate effect of each of the following transactions on commercial bank reserves. Assume that the initial reserve ratio is 20 percent. Federal Reserve Banks purchase $2..
A manufacturer plans to open a new plant. The new plant will cost $4,000,000 to build and make ready for production. Company management believes that the plant will produce a net profit of $150,000 in the first year and that profit will increase 5% p..
"A high level of public spending crowds out the level of private domestic investment. Therefore, if the government cuts its expenditures and free resources for private investment, it can ultimately increase income per capita" Comment on the statement
In classical macroeconomic theory, the concept of monetary neutrality means that changes in the money supply do not influence real variables. Explain why changes in money growth affect the nominal interest rate, but not the real interest rate.
Assume that in a private closed economy consumption is $240 billion and investment is $50 billion, both at the $280 billion level of domestic output.
Suppose the following table reflects the domestic supply and demand for compact discs (CD’s). Now suppose that foreigners enter the market, offering to sell an unlimited supply of CD’s for $6 apiece. Illustrate and identify.
Why are entrepreneurs willing to supply goods and services for consumers at attractive prices? Is it because they care personally about the consumers?
Suppose a firm finds that the marginal product of capital is 60 and the marginal product of labor is 20. If the price of capital is $6 and the price of labor is $2.50, describe how the firm should adjust its mix of capital and labor? What will be the..
In "Kitchen Nightmares," Chef Gordon Ramsay visits struggling restaurants and gives the owners of the restaurant a number of recommendations intended to reverse the restaurant's prospects. Explain how the recommendation is an application of Economies..
What happens to the demand for Sara's sweatshirts in long run. In long run, what happens to Sara's economic profit.
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