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Suppose you are a consultant for a firm that is perfectly competitive. The firm is worried only about its policies in the short run. What would you recommend in terms of quantity changes (raise, cut, shut down or stay put) and price changes (raise, cut, stay put) in each of the following situations (a through e):
a. P= $117 MC= $128 AVC= $ 106b. P= $190 MC= $ 200 AVC= $200c. P= $405 MC= $ 400 AVC = $400d. P= $242 MC= $242 AVC= $241e. P= $146 MC= $146 AVC= $ 156
Ymir Larson farms near Niffleheim, Minnesota. He works 80 hours a week. He can either grow rutabagas or raise pigs. Every hour that he spends growing rutabagas gives him $2 of income this year. Every hour that he spends raising pigs this year will..
The Federal Reserve Banks sell $3 billion in securites to members of the public, who pay for the bonds with checks. Show the new balance sheet for commercial banks if reserves = 33, securites = 60, checkable deposits = 150, and reserve banks = 3.
Define a variable Z that is a function of the sample average ? and follows a standard normal distribution. What is the probability that ? will be in the interval [1, 3] What is the probability that ? will be in the interval [-1, 1] What is the probab..
The Following table shows the regression coefficient (B) and the t-statistics (T) for the variables influencing business traveler demand for hotel rooms (including hotel prices and attributes) from the study Business Traveler Demand for Hotel Rooms
Suppose the consumption function is C = $500 billion + 0.9Y and the government wants to stimulate the economy. By how much will aggregate demand at current prices shift initially (before multiplier effects) with: A) $50 billion increase in governm..
An investor bought 100 shares of Omega common stock for $9000. He held the stock for 9 years. For the first 4 years he received annual end-of-year dividends of $800. For the next 4 years he received annual dividends of $400.
Consider the market for gasoline. In the initial equilibrium, the price is $2.00 per gallon and the quantity is 100 million gallons. The price elasticity of demand is 0.70, and the price elasticity of supply is 1.0.
A firm pays in cash $250000 inwages, $55430 in interest on borrowed money capital and $74320 for the yearly rental of its factory building. If the entrepreneur worked for somebody else as a manager, he would earn at most $44500per year
Jethro has been promised a payment of $1000, which is to be paid exactly 8 years from now. He is completely certain that the payment will in fact be made. Jethro believes that the appropriate discount rate is 5% per year, and that this will contin..
The machining time per piece if 0.164 h, and the machine loading time is 0.038h. With an operator rate of $12.80/h and a machine rate of $14/h, calculate the optimal number of machines for the lowest cost per unit of output.
Suppose that the Fed's inflation target is 2%, potential output growth is 3.5%, and velocity is a function of how much the interest rate differs from 5%: %^V= 0.5 X (i-5). Suppose that a model of the economy suggests that the real interest rate.
Assume that in a different competitive industry, there are 8 firms, each with a marginal cost equal to MC = 20-10q +q^2 Average cost is minimized at q = 10 and AVC is minimized at q = 8 for each of these firms. Demand for the product is P = 100-QD
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