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Suppose that an industry has high fixed costs to enter but, other than that, is competitive.
A. What will be the effect of the high fixed costs to the number of firms in the industry? To the firm size ? Is marginal cost higher or lower for a firm with high fixed costs? Is price higher or lower? Is quantity produced higher or lower?
B. Give an example of a firm with a high fixed cost and a firm with a low fixed cost. Give an example of a firm with low variable costs and a firm with high variable costs.
Elucidate an example of a microeconomic and macroeconomic phenomenon. Would you give an example of a microeconomic decision you have made at home or work.
In October 2011, Apple introduced the iPhone 4S, which had new features, including camera and voice control, but sold at the same price as the previous iPhone model. How did the introduction of the iPhone 4S affect the Consumer Price Index? What fact..
What are at least two diagnostic checks you should apply to a Box-Jenkins model to determine its reliability (excluding error measures such as MSE, RMSE, etc.)?
Which of the following was not a cause of the U.S. budget deficits in the 1980s? Which of the following does not qualify as an automatic stabilizer? Income taxes affect aggregate demand. Which of the following constitutes a direct tax?
What is the expected impact of fall the business confidence. Explain with suitable diagram. Will monetary policy help to increase the investment by private sector in the presence of fall in the business policy.
Midlands Design Ltd. of Manchester, England, is a company specializing in providing design services to residential developers. Last year the company had net operating income of £410,000 on sales of £2,000,000. The company’s average operating assets f..
According to the lectures in class, although consumption spending is about 70% of the total spending in the US economy (C=70%, I=15%, G=15%) its effect is stronger than 70% on the economy why?
An investor is considering buying a 20-year corporate bond. The bond has a face value of $1,000 and pays 6% interest per year in two semi annual payments. To receive 8% interest, compounded semi annually, how much should be paid for the bond?
If one producer is able to produce a good at a lower opportunity cost than some other producer, then the producer with the lower opportunity cost is said to have an absolute advantage in the production of that good.
A cost-effective policy is always socially efficient. Enforcement costs are critical to the success of environmental programs and should be included in the overall social costs of the program when evaluating different policy options.
She gets pleasure not only from her spending money but also from her leisure hours. Draw her budget constraint in leisure-expenditure space.
Consider the case of asymmetric information discussed in section 3.5, in which a seller may know that her product is high in quality but a buyer may not know it. describe two different steps the seller might take to avoid the adverse selection proble..
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