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Assume customers arrive to an M/M/1 queue at the average rate of 10 customers/hour. For safety reasons, the manager wants to have no more than 2 customers in the system at any time. What should be the service rate to make sure that the chance of having no more than 2 customers in the system is 90%? Recall that the arrivals are random so we cannot make 100% sure this never happens.
Explain the basics of stakeholder theory as if you are talking to a friend. Should a corporation care about the interests of people other than shareholders? How would a corporation behave differently if it accepted a shareholder theory versus a stake..
Ceteris Paribus is latin for. An example of ordinal measure would be. Which slope(s) may a supply curve not have? The fact that as we consume more of good we enjoy each subsquent unit less (1st hot wing vs. hot wing) is an example of what theory?
Mary has borrowed $125,000 at 8% from her parents. She is asking Kevin for $75,000 to start her own business. Kevin requires that the business make a 12% rate of return. What is Mary's before-tax cost of capital?
What if you knew that in Firm A the quantity of labor demanded is 15,000 when the wage is $11 and 17,000 when the wage is $8.
Graphically illustrate the effects to total surplus of a per unit excise tax placed on an inelastic good. Make sure to clearly(i.e. remember our in-class rule for showing areas) denote which areas make the loss in consumer surplus, loss in producer s..
In January of 2007 online movie rental service Netflix introduced a new feature to allow customers to watch movies and television series on their personal computers. Netflix competed with many video rental retailers, which added online rental service..
You are the manager of a firm that sells a “commodity” in a market that resembles perfect competition, and your cost function is C(Q) = 2Q + 3Q2. Unfortunately, due to production lags, you must make your output decision prior to knowing for certain t..
Preston is in the 30% tax bracket and he holds a municipal bond that pays a tax-exempt interest rate of 8%. What is the taxable equivalent bond yield?
Which statement does NOT correctly describe bonds?
Draw labor supply and demand curves for cashiers in Hadley supermarkets. Real World Micro 2.4: Jeannette Wicks-Lim argues that the minimum wage could be raised without causing significant job loss. Why, in her view, would companies pay higher wages w..
Milo and George are barbers. In one day, Milo can give 6 haircuts or give 8 shaves. In one day, George can give 5 haircuts or give 10 shaves. What is Milo’s opportunity cost of one haircut? What is George’s opp. cost of one haircut? Who has absolute ..
In a macroeconomic equilibrium,
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