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Q1. Edison Electric Company's president has been arguing that residential electric rates need to be raised relative to industrial rates. His reason is that the rate of return that the company earns on its assets is higher from its industrial customers than from its residential customers. Is this a good reason? Explain how can Edison determine its assets dedicated to the two classes of customers?
Q2. Real GDP was $4719 billion in year 1 and $4848 billion in year 2. In contrast, real GDP per capita in year 1 was $19261, but in year 2 it was only 19162. Why did one measure increase while the other measure decreased?
What would you do if patent law prevented your rival from cloning your product.
Merit goods have received considerable attention. Can concerts and other publicly provided services be rationalized using these ideas.
Which resource of production is the only one which nations can significantly increase in the short term.
If you deposit money today in an account that pays 6.5% annual interest, how long will it take to double your money.
Explain how the MAS have successfully used exchange rate policy to achieve price stability for the last two decades.
illustrate what was the size of the economy's recessionary, inflationary gap
Analyze the reasons for and against the merger and assess the actual performance of the consolidated company against the pre-merger expectations.
They could each decide to work a few extra hours on Saturday and earn more income. But they choose to play tennis or to relax around the house.
Describe the Schumpeterian notion of "creative destruction"
How many DVD's will she have to sell to keep the store open for an extra hour to make profit, if each DVD is $12.
Distinguish between the two types but knows the probabilities of each type. What would be the result in this market for loans.
Explain how does the existence of money reduce the costs of making transactions relative to a society based entirely on barter.
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