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If the government were to increase taxes on gasoline, what will happen to the total government revenue? Why? What are you assuming about the elasticity of the demand curve of gasoline? What is the formula for elasticity? Would the government make more tax revenues taxing airline tickets instead? Why or why not? What assumptions are you making about the elasticity of airline tickets? Make sure to graph the demand curve for both gasoline and airlines.
How much does each firm produce if they move simultaneously? What is the equilibrium price?
What will happen to Jill's consumption in first period when interest rate increases. Is Jill better off or worse off than before interest rate increase.
Describe the determinants of varying levels of income. What factors determine a wages of a person
Assuming that the current production rates are maintained at the three assembly plants, which alternative should management select?
Calculate GDP loss and government expenditure needed to eliminate this loss if full employment GDP is $400, unemployment rate 8.9%, and the MPC is 0.8.
Metro Limo also Urban Limo, operate nine passenger vans. These duopolists cannot compete with price, but they can compete through advertising.
Illustrate what is the opportunity cost of a potholder for Martha. What is the opportunity cost of a potholder for Stewart.
After 25 years explain how much larger is Country B's economy the Country A's economy. Why is the answer not 25 percent.
Discuss how the two cases in this chapter illustrate the major theme of this text: changes in the macro environment affect individual firms and industries.
How do fixed costs play a role in your analysis? What is the difference between shutting down and going out of business?
A hearing is scheduled for your company to present arguments that your firm has not increased its market power through this merger. Can you do this? How? What evidence might you bring to the hearing?
Elucidate how resource scarcity influences this marketplace also describe choices stakeholders must make.
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