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A firm operates with the production function Q = 1.4K 0.4 L0.5.
(a) If the prices of labor and capital are $10 and $20, respectively, and the firm's allocates only $8,000 a day for production costs (net of fixed cost) how many units of output can the firm produce? (Use the substitution method).
(b) How many units of labor and capital does firm employ?
(c) If the price of the good is $35 per unit, what is the daily profit of this firm?
Write a one-page policy brief that addresses the questions above and write in paragraph form and do not number the paragraphs.
Graph the supply and demand schedule for pizza using $5 through $15 as the value of p. In equilibrium, how many pizzas would be sold at what price?
Definition and explanation of the indices, e.g., GDP, CPI, and other economic calculations
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In the market for laptop computers, assume future prices are expected to fall. Using two graphs draw two possible but different scenarios that may result which account for how consumers would react and how producers would react. (Hint: In each graph,..
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The demand function for DVD players has been estimated to be Q Player = 134 - 1.07PPlayer + 46Pm - 2.1PDVD - 5M, where QPlayer is the quantity of DVD players, PDVD is the price of a videocassette, Pm is the price of a movie, PPlayer is the price of a..
Suppose that the reserve requirement is 10 percent and the balance sheet of the People's National Bank looks like the accompanying example. • What are the required reserves of People's National Bank Does the bank have any excess reserves
Suppose that aggregate demand increases such that the amount of real output demanded rises by $7 billion at each price level. By what percentage will the price level increase? Will this inflation be demand-pull inflation or will it be cost-push infla..
Currently the expected yearly inflation rate in U.S. is a bit less than 2.0% but let’s assume for simplicity that it is equal to 2.0% (which was also very close to the actual, as opposed to expected, inflation rate in 2012 in U.S.).
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