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Repeat the previous exercise but include a tax on interest income. Graph the steady state capital-labor ratio against the tax rate. Comment on the results.
Suppose the initial equilibrium price of haircuts is $12. Draw demand and supply graphs to show the short-run and long-run effects
Suppose the residents of Vegopia spend all their income on cauliflower, broccoli, and carrots. In 2005, they buy 100 heads of cauliflower for $200, 50 bunches of broccoli for $75, and 500 heads carrots for $50. In 2006, they buy 75 heads of caulif..
Suppose that now research firms can sell their machines to all producers in the world, including those in the South, and can charge the same markup. Derive the steady-state equilibrium under these conditions.
A potential entrepreneur is trying to decide whether to open a new health spa. She presently makes $35,000 per year as an aerobics instructor and will have to give up this job if she opens the new health spa. If she chooses to open the spa, it wil..
Based on the new information provided by this experience, should the firm produce more deliveries by increasing its workforce, or produce fewer deliveries by reducing its workforce? Explain, using the marginal principle.
Plot the residuals versus the order in which the observations were made. Is there a trend in the residuals over time? Does the linear model seem appropriate? Explain.
An oil company purchased an option on Land in Alaska. Preliminary geologic studies assigned the following prior probabilities. After 200 feet of drilling on the first well, a soil test is taken. The probabilities of finding the particular type of so..
A. If the interest rate is 15% for the time period for both borrowing and saving, what is the maximum she can borrow against her future income B. What is the present value of lifetime resources available to Abby
You are going to purchase a house which costs $250,000. Your annual income is currently $60,000. The bank you are going to get the mortgage from uses a 28% qualifying rate (a maximum of 28% of your gross monthly income can go to your monthly payme..
Mark owns ABC Karate . He has a 2-yr lease and those monthly payments are fixed over that time period. Mark wants to increase his revenues and is trying to decide to raise or lower the monthly fees he charges each student.
Assume that when using the multiple regression in the formula Y = b1X1 and b2X2 + E that X1 represents wages and X2 represents transportation expenses?
Rubax, a United States producer of athletic shoes, estimates the following linear trend model for shoe sales:
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