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A brewery produces two kinds of beer, stout and IPA . Each batch of stout sells for $60 per unit while each batch of IPA sells for $108. Both products require malt, hops, barley, filtered water, and yeast, measured in physical "units" for convenience. Each batch of stout uses 1 unit of malt, 1 unit of hops, 2 units of barley, 5 units of yeast, and 10 units of filtered water. The corresponding requirements for IPA are: 5 units malt, 2 units hops, 1 unit barley, 8 units yeast and 9 units water. On any given day, the brewery has on hand 150 units of malt, 90 units of hops, and 150 units of barley. The brewery pays $2 per unit for filtered water and $4 per unit of yeast.
Explain why P=MC in the short-run equilibrium of the perfectly competitive firm, whereas in the long-run equilibrium P=MC=AC.
What is top marginal rate of taxation?
You are an assistant to a senator who chairs an ad hoc committee on reforming taxes on telecommunication services. Based on your research, AT&T has spent over $15 million on relate
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Aggregate Demand Policies Both fiscal and monetary policy changes shift the AD curve. Let us see how, starting with a fiscal expansion. See figure 6.2. In the upper panel, the
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