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Liquidated Damages. B-Sharp Musical Productions, inc., contracted with James Haber to provide a sixteen-piece band at Harber's son bar mitzvah for $30,000. Their contract stipulated payment of half of the price if Haber canceled more than ninety days before the performance and entire price if he canceled less than ninety days before. Haber canceled the deal less than ninety days before the bar mitzvah, but refused to pay the price. Is the provision for the payment of the entire price enforceable? Explain in 50 or more words.
Suppose you are offered the alternative of receiving either $2,007 at the end of five years or $1,500 today. There is no question that the $2,007 will be paid in full (i.e. there is no risk). Assuming that the money will not be needed in the next fiv..
In the Wall Street Journal article included in this week's lesson, what change in the small drugstore chain's product differentiation strategy has helped lift profitability? What has been responsible for the success of this strategy (who comprises th..
Suppose the welfare benefit formula is, How large is the benefit if wages equal. What is the breakeven level of income in this case?
Opportunity cost is associated with choosing a particular decision that is measured by the forgone benefits of the next-best alternative. What example would you pose to explain this?
“Pollution is causing $100 million worth of damage to the environment and we are only spending $1 million to reduce pollution. We are clearly not spending enough on fighting pollution.” Is this statement true? How can marginal analysis needed to answ..
Volkswagen company is Germany own company with a massive factory in Mexico. In 2013, the Volkswagen Mexican factory produced $228 worth of cars and sold $6 to the U.S., $51 to Mexico, and $10 to Germany. How much was added to Germany’s GDP?
If market participants expect higher inflation in the future, the quantity of loanable funds demanded will increase. This will cause a movement along the demand function for loanable funds. If credit risk increases, supply of loanable funds will shif..
In 2006 the CEO of Bear Sterns, James Caynes, received a compensation package of $34 million. The following year Bear Sterns cost $2.7 billion to the taxpayers. Angelo Mozilo and two other top executives were charged by the Security and Exchange Comm..
Health savings accounts (HSAs) A. allow employees, but not employers, to make tax-deductible contributions to an account. B. are accessible to those with qualifying insurance plans with annual deductibles of $500 or more. C. are accessible to employe..
You were planning to spend Saturday working at your part-time job, but a friend asks you to go skiing. Which of the following are included in the true cost of going skiing? Check all that apply. Now suppose you had been planning to spend the day stud..
Consider a perfectly competitive industry. Market demand is P=500-2Q and all firms are identical. Find the market’s long-run equilibrium price. Show that the firm's profit is zero at this price. c. If all firms are identical, then how many firms is c..
Draw a supply-demand diagram representing the effect on the market for hybrid autos of a permanent increase in the equilibrium price of gasoline from around $2.00 per gallon to around $4.00 per gallon.
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