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1. As a result of the North America Free Trade Agreement, many ionic "American" cars are not assembled in the United States. Please explain why? Provide some examples of U.S.cars that are assembled outside of the United States?
2. Outsourcing of services by American firms has contributed significantly to wage growth in India. Explain why usint a graph of the Indian labor market?
3. Chanel perfume is sold in France and in the United States. Assume initially that one Euro is worth $1.30 and that the a 100ml bottle of perfume sells for $80 in the United States. If Chanel does not price discriminate internationally, what is the price that would be paid for this perfume in France? Now suppose that Chanel decides to price discriminate and finds that it would maximize its profits by lowering its price in the United States to $70 and raising its price by 25% in France. Explain why? Next, explain what happens if the value of the Euro rises by 25% in terms of the dollar?
If the exchange rate at the end of the year is 105 yens for a dollar then what would be the inflation rate be in the US.
Suppose we want to study the relationship between a household's income and its spending on "essentials". We've collected some data on a variety of households, some of which you see here: Income and Spending for four households Both Income and "Essent..
Illustrate what kind of gap-inflationary or recessionary-will economy face after shock and illustrate what type of fiscal policies would help move economy back to potential output.
Mathematical Oligopoly Problem. Suppose a duopoly is operating using the following information. The firms are denoted Firm a and Firm b. Use the Cournot solution method to find the output-reaction equations for both firms.Use the Cournot solution met..
A car dealership typically determines a distinct price for a car for each customer. This is an example of what type of price discrimination? Why is the dealership able to carry out this type of price discrimination?
Classify each of the following pricing strategies and explain. A local restaurant offers an "all you can eat" salad bar for $3.49. With any sand which, a customer can add the "all you can eat" sales bar for $1.49.
One assumption of the supply and demand model is that all goods that are bought and sold are identical. Why do you suppose economists commonly make this assumption? Does the supply and demand model lose its usefulness if goods are not identical?
q.a borrower takes out a loan from a bank and can invest in a risky project that will produce revenue of 185 with
In a pure monopoly, the monopolistic firm is the only one selling the product, therefore there are no constraints on what the firm can charge or on the profit it can make. Do you agree? Why? Discuss various barriers to entry into an industry, explain..
Lauren Moore has sold her business for $720,000 also wants to invest in condominium units (
What would happen if no one tried to manage the business cycle? What role do you see for the Executive Branch of the U.S. government in managing the business cycle?
Consider an initial stock of 5000 tons of high grade ore. The demand function for this ore is P = 2400 – 0.2Q (Q is measured in tons/year), and the cost of extraction is constant at c = $200/ton. The discount rate is r = 0.10. Using a discount rate o..
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