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Behavioral economists suggest that brand-loyalty, which can be a source of monopoly power for the producer, may be explained by consumers' tendency to have the:
Anchoring effect
Confirmation bias
Status quo bias
Mental accounting effect
Consider the Solow Growth Model with technology given by Y = zF(K, N) = zK^(1/2)N^(1/2) , savings rate= 0.2, and depreciation rate=0.1. Both population growth and technological growth are 0. (Note: lower case letters denote per capita variables e.g. ..
Although water is essential to life no matter where one lives, the demand for water differ across regions. In one study it was found that the price elasticity of demand for water in all regions of the United States ranges from 0.39 to 0.69. Why is th..
q.a brewery is considering two potential production investmentsoption a costs an initial 2 million as well as will
According to Banerjee and Duflo, poor people make decisions differently than do those who are not poor. In their view, this is the fundamental obstacle to economic development in poor countries. Do you agree or disagree? Explain your answer.
After 1945, Post-modern art is frequently divided into four groups: Neorealism, Neoexpressionism, Neoclassicism, and Modernist Abstraction. Define each of these terms, and their main characteristics. Be specific, including names of artists and titles..
If automatic stabilizers change the federal budget balance by 70 billion for every one percent change in Real GDP growth what will happen to the federal budget balance at the economy falls into recession of -3 % from a growth path of + 2%
Given the long-term budgetary deficits facing the federal government, some members of Congress have advocated repealing the prescription drug benefit that it created for Medicare beneficiaries in 2003 (i.e. Medicare Part D). If that should happen, ho..
Suppose there are two firms in a market that each simultaneously chooses a quantity. Firm 1's quantity is q1, and firm 2's quantity is q2. Therefore the market quantity is Q = q1 + q2. The market demand curve is given by P = 160 - 3Q. Also, each firm..
The Charm City Bakery makes coffee cakes and Danish pastries in large pans. The main ingredients are flour and sugar. There are 25 pounds of flour and 16 pounds of sugar available. Formulate a linear programming model for this problem. Find the optim..
A robotics system will be purchased for a factory. The lease-purchase costs is $100,000 per year. Warranties will also be purchased. The warranties start at $20,000 in year 5 and increase by $20,000 per year through the end of the lease. What is the ..
Joint output of individuals or nations will be maximized when goods are exchanged between parties in accordance with the law of "comparative advantage". An increase in consumer income will affect the supply of any given product. The production possib..
At what level of output will this firm maximize profit. Elucidate what is the level of profit for every unit of output produced at equilibrium.
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