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Columnist Jack Mabley of the Chicago Tribune reports that "General Motors just increased prices another 2.5%" even after a "bad year" and concludes that "if the law of supply and demand were working, GM would reduce prices, not raise them."
Do you agree or disagree with Mabley's argument? Use Supply and Demand analysis to explain.
Consider a numerical example. Originally, prices were p1 = p2 = 1 and income was 10. In the next year the price of good 1 doubled. The price of good 2 stayed the same. Calculate the CPI income adjustment. Calculate the new optimal bundle. And lastly,..
If a $24 per share stock has a P/E ratio of 20 and pays out 40% of its profits in dividends, how large is its dividends? Also what is the implied rate of return?
A monopolist's demand curve is given by P = 100 - 2q. (a) Find his marginal revenue function.
In a fictional city, the city council introduces a new $500 per month tax on one-bedroom rental units. The tax raises the typical monthly rent on one-bedroom units from $950 per month to $1,050 and it lowers the number of one-bedroom units rented out..
What do you think is the future of such predictive capabilities?
The production function is given by f(x)=4x^1/2. If the price of a commodity produced is $60 per unit and the cost of the input is $20 per unit, how much profit will the firm make if it maximizes profit?
Illustrate what would be total incremental investment in accounts receivable and invent theory to support expected increase in sales.
Explain the relationship between one's beliefs about whether the minimum jobs program presented in the chapter actually solves the unemployment problem and one's normative view of responsibility for unemployment.
Illustrate what is the minimum price necessary for this firm to produce any output in the short run.
An argument can be made that the Government could improve consumer welfare by requiring companies to provide accurate information to consumers about their products. Should the Government increase, decrease or remain the same in its level of intervent..
Identify the major human activities that impact the environment. Give a specific example of such activities. Weigh the consequences, benefits, and necessities addressed by the activity and the cost of implementing a sustainable approach
Elucidate why would elasticity of demand be important to you in determining the products on which the taxes should be levied.
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