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Suppose that a paper mill earns $400,000 when it pollutes a river, and that it can abate pollution at a cost of $80,000. The effects of pollution are confined to a single farmer, who earns $530,000 if the water is clean and $330,000 if it is polluted. Assume that bargaining is frictionless and that the parties will split the gains from any agreement equally. What agreement will the mill and the farmer negotiate if the mill has the right to pollute? What if the farmer has the right to clean water?
What is achieved by selecting the quantity of an activity at which marginal benefit equals marginal cost?
If the rate of discount is 20 percent, a Would you rather receive $100 today or $120 in one year b Would you rather receive $205 today or $240 in one year c Would you rather receive $500 in one year or $610 in two years
What is the most realistic relationship between bads and TU and bads and MU? Given this relationship (the assumption), will the MRS on an indifference curve increase or decrease (determined by the direction the indifference curve is bowed)?
If supply is given by Qs = 1000 and the government imposes a tax of 50 on iPhones that must be paid by sellers then Producers will bear the full economic burden of the tax but how come there is no deadweight loss
Assuming there is no way to make other residents contribute, is Eugene likely to raise the necessary $1,000? Why or why not? What could he do to improve his chances of success?
Your company has a customer who is shutting down a production line, and it is your responsi-bility to dispose of the extrusion machine. The company could keep it in inventory for possible future product and estimates that the reservation value is ..
A purely competitive firm finds that the market price for its product is $30.00. It has a fixed cost of $100.00 and a variable cost of $15.00 per unit for the first 50 units and then $35.00 per unit for all successive units.Does price exceed avera..
the purpose of this excise is to have you confirm empirically the relationship that theoretically should occur among
A telephone distribution company is considering building a new automated switching equipment substation with a useful life of 20 years. The company uses a 14% MARR to assess capital investment projects. Estimated real dollar costs and benefits
The Australian government administers two programs that affect the market for cigarettes.
A firm purchases goods on credit worth $1,250. The same firm pays off $1,000 in old credit purchases. An investment is made via the purchase of a new facility and equity is issued in the amount of $3,000 to pay for the purchase.
As a dentist you find that a person's annual demand curve for appointments are P=500-50Q. The marginal cost for your service is $50 There are three ways you could charge for your services -Charge $50 each time someone makes an appointment -Sell an an..
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