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Q1. Assume that Mr. Brown's MPS=MPC. If he makes an extra $1,000 this year, and this increase in his income does not change his marginal propensities, how much of this $1,000 will Mr.Brown save?
Q2. Consider chip plants: potato and computer. Assume there is a large rise in the demand for computer chips and potato chips.a. How responsive to demand is each in the market period?b. Describe what a manufacturer of each product might do in the short run to increase production.c. How does the long run differ for these products?
Repeat these calculations for the third, fourth, and fifth years, assuming that the Government taxes at a rate each year and has noninterest expenditures annually.
Calculate the original market equilibrium price and quantity in absence of the price support policy.
Population growth in developing nations has proceeded at unprecedented rates ower the past few decades.
Two firms are located on the line and sell identical products. Consumers obtain K utility from consuming a product; assume that K is large enough that all consumers purchase from at least one of the firms despite the costs of transportation.
If most businesses in an industry are earning a 13 percent rate of return on their assets, but your firm is earning 23 percent what is your rate of economic profit
Make sure that you consider two cases. In the first case, the consumer does not pay any tax before x is reduced, and in the second case, the consumer pays a positive tax before x is reduced.
The municipal swimming pool charges lower entrance fees to local residents than to non-residents. Conclude that non-residents must have for swimming at the pool than residents.
Explain why Blazo's performance from providing these services to ABC Company and other firms will decline if economic growth is reduced.
What would the' peso- dollar exchange rate be if purchasing-power parity holds? If a monetary expansion caused all prices in Mexico to double, so that soda rose.
Should Roscoe's Rascals match the price offered by the competitor.
Country Z is a developing country that is facing problems of deforestation.
Explain why monopolistically competitive firms frequently prefer nonprice competition to price competition.
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