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Suppose an individual's marginal rate of substitution is three slices of pizza for one beer at the present bundle of beer and pizza she is consuming. If the price of beer is $1.00 and the price of a slice of pizza is $1.50, is the consumer maximizing her welfare?
Suppose that initially G is $100 and equilibrium real GDP demanded is $1,000. If the multiplier is 4 & G increases to $200, real GDP demanded will increase
Why can the distinction between fixed costs and variable costs be made in the short run. Classify the following as fixed or variable costs: advertising expenditures, fuel, interest on company-issued bonds, shipping charges, payments for raw materi..
The state of Maine has a very active lobster industry, whichharvests lobsters during the summer months. During the rest of theyear, lobsters can be obtained from other parts of the world but ata much higher price.
Periodically you hear of garbage strikes. Is garbage pickup a public good? Does garbage create externalities? What should be done about it? Why does garbage collection seem to attract organized crime?
Illustrate what are the pros and cons of companies competing in the global environment and how this has affected the U.S. economy and the global economy.
Suppose one economist believes the target rate of unemployment is 4.3 percent while another believes it is 5.5 percent. Using Okun's rule of thumb, by how much would you expect their estimates of potential GDP to differ in a $12 trillion economy
Calculate the cross-price elasticity for the following goods. Are they complements or substitutes?
Why is it necessary for all economic system to not only provide poepl with goods and services but also restricts them from getting as much of these goods and services as they wish?
Do you think that monetary policy should cooperate with fiscal policy? If so, why? How could their joint actions affect the level of the debt-to-GDP ratio?
What are government's fiscal policy options for ending severe demand-pull inflation? Which of these fiscal options do you think might be favored by a person who wants to preserve the size of government?
Suppose that any money lent by a bank is always deposited in a checkable deposit and that the reserve ratio is 10%. The Fed purchases $100 million in Treasury bills.
Why might a firm charged with violating the Clayton Act, Section 7, try arguing that the products sold by the merged firms are in seperate markets. Why might a firm charged with violating Section 2 of the Sherman Act try convincing the court that ..
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