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Shawn Bates was working to establish a business enterprise with four of his wealthy friends. Each of the five individuals would receive a 20 percent ownership interest in the company. A primary goal of establishing the enterprise was to minimize the amount of income taxes paid. Assume that the five investors are in a 40 percent personal tax bracket and that the corporate tax rate is 25 percent. Also assume that the new company is expected to earn $525,000 of cash income before taxes during its first year of operation. All earnings are expected to be immediately distributed to the owners.
mechanical engineer who recently graduated with a masters degree is contemplating starting his own commercial heating
Explain how this may be related to the problem of adverse selection. What could banks do to try to reduce this problem?
Competitive free marketplaces maximize the utility of those who participate in them; they also maximize society's total utility.
Elucidate how Levitt devised a means of examining student test scores to uncover evidence of cheating teachers. Explain also why Levitt's analysis of the data constituted evidence, but not proof, of cheating.
If you were a manager at PepsiCo, would you try to convince your colleagues while introducing the new soft drink is the most profitable strategy.
The government sets a price floor of $5 in the above market. Is this price control binding? If so, is there a shortage or a surplus and what is its magnitude.
Please sketch this equation and make sure that you label the vertical and horizontal axes and the original point. Given X =1, Y = 4, what is the location of this point on the PPF graph? (In other words, is this point outside the PPF? On the PPF? Insi..
Suppose the U.S. and Mexico both produce 2 goods, tablets and cereal, using 2 inputs, capital (K) and labor (L). The production of tablets is capital-intensive, and that of cereal is labor-intensive. The U.S. is a capital-abundant country, and Mexico..
A new OSHA rule requires that welders be given 2 hour break for every 2 hours of work to prevent carpel tunnel syndrome. Using production theory, explain what will happen to the capital labor ratio in both the short run (when capital is fixed) and..
If average total cost of producing wheat is $8 and cost of wheat is $6, illustrate what would you advise farmer to do.
explain and categorize the cost of inflation. Because of inflation has risen, the L.L Bean Company decides to issue a new catalog quarterly rather than annually.
You recently hired an economist to work with engineering also operations experts to estimate the production function for a particular line of office chairs.
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