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Consider the expanding input variety model of Section 13.1, and assume that corporate profits are taxed at the rate τ.
(a) Characterize the equilibrium allocation.
(b) Consider two economies with identical technologies and identical initial conditions but with different corporate tax rates, τ and τ' . Determine the relative income of these two economies (as a function of time).
what uniform price will he charge and how much profit will he earn. The following figure shows the demand and marginal revenue for a monopolist, who has many buyers with different valuations of the good.
What is supply-side economics? Is it likely to be effective, given your answer to (a)?
Assume a firm wants to minimize its cost of producing y amount using x1 and x2 as inputs, which means it wants to minimize w1x1 + w2x2 subject to x1^(1/2)x2^(1/2)= y: (a) Using Lagrange multiplier method, find optimal x1 and x2 as functions of w1,w2 ..
Note the sum of current account balances around the world. As noted in the chapter, the sum of current account balances should equal zero. What does this sum actually equal? Why does this sum indicate some mismeasurement (i.e., if the sum were cor..
The output of workers at a factory depends on the number of supervisors hired (see below). The factory sells its output for $0.50 each; it hires 50 production workers at a wage of $100 per day, and needs to decide how many supervisors to hire.
the supply curve for product x is given by qxs -340 10px .a. find the inverse supply curve.p qb. how much surplus
The firm currently uses 50,000 workers to produce 200,000 units of output per day. The daily wage per worker is $80, and the price of the firm's output is $25. The cost of other variable inputs is $400,000 per day.
Compute the discount factor 1/(1+r)^t for r=1, 5, or 10 perent interest rates and t=30 and 50 years. remember that 1 percent is .01. based on your computation, is teh choice of discount factor important for deciding whether to do somehtinga bout g..
suppose that disposable income consumption andy saving in some country are200 billion 150 billion and 50 billion
Suppose First National Bank has $200 million of assets and $20 million of equity capital. If First National has a 2% return on assets (ROA), what is its return on equity (ROE) Suppose First Nationalís equity capital declines to $10 million
The industry demand function for bulk plastics is represented by the following equation: P=800-20Q Where Q represents millions of pounds of plastic. The total cost function for the industry, exclusive of a required return on invested capital, is TC=3..
consider the following production function: q= 8lk+ 4l^2-(1/3)^3, Given the following expression for the marginal productivity of each input: MPl= 8K+8L -L^2 and MPk -8L Assuming capital is plotting in vertical axis and labor is plotting in horizont..
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