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For each of the following situations, decide whether the bundle Lakshani is thinking about consuming is optimal or not. If it is not optimal, how could Lakshani improve her overall level of utility? That is, determine which good she should spend more on and which good should she spend less on
Why did president Obama want to repeal the Bush era tax cuts on upper income tax payers How would the repeal of these tax cuts impact aggregate demand and to what degree How did the economic conditions in 2010 make such a repeal less likely to tak..
If leisure is a normal good, the Laffer Curve can have an inverted U-shape only if leisure and consumption are (at least at some point) sufficiently substitutable such that the substitution effect (on leisure) outweighs the wealth effect (on leisu..
What is (are) the emerging structure(s) (not necessarily the final results) of increased economic interactions suggested by the interdependence, dependency and mercantilist perspectives
Suppose two types of firms wish to borrow in the bond market. Firms of type A are in good financial health and are relatively low risk. The appropriate premium over the risk-free rate for lending to these firms is 2%. Firms of type B are in poor f..
Describe the pricing strategies in monopolistic competition, oligopoly, and monopoly market models. Explain which market structures are price makers and price takers. What is the difference in the demand curves and why.
Why does the burden of sales tax fall completely on customer when the value elasticity of demand is perfectly inelastic; the seller when perfectly elastic.
"I see that your shoes are ‘buy one, get one free - limit one free pair per customer.' Will you sell me one pair for half-price" The clerk answered, "I can't do that." When the customer started to leave the store, the clerk hastily offered,
For a typical competitive firm, the price in the long run equilibrium will tend to: be greater than average cost, be equal to average cost, be less than average cost, intermediate
Calculate the magnitude of the consumer surplus and producer surplus in the pre-tax equilibrium and calculate the tax revenue in the post-tax equilibrium
Suppose the demand for total snuffbox production is given by Q = 1,100 – 50P. What will be the equilibrium in this marketplace.What will each firm’s total short – run profits be.
Revitalize the Housing Market
During 2005, Orlando, Florida, was increasing rapidly, with new jobs luring young people into the area. Despite rise in population and income growth that expanded demand for housing,
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