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Q1. Let's think about two countries, Frugal and Smart. In Frugal, people devote 50 percent of GDP to making new investment goods, so = 0.5, and their production function is Y. In Frugal, people devote 25 percent of GDP to making new investment goods, so = 0.25, and their production function is Y = 2. Both countries start off with K = 100. What is the amount of consumption in each country this year?
Q2. As vice president of sales for a rapidly growing company, you are grappling with the question of expanding the size of your direct sales force (from its current level of 60 national salespeople). You are considering hiring from 5 to 10 additional personnel.
Suppose, on the other hand, that the second country retaliates with an export subsidy of its own.
It comes to global expansion and setting up affiliates aboard, how is a service company's focus different from that of a manufacturing company
Specify the set of mutually beneficial allocations relative to the initial endowment and illustrate the set.
Find Equilibrium GDP (Y). If potential GDP is 1950, is the economy in a recessionary or inflationary gap. Suppose that the MPC, falls to 0.75, so C = 0.85DI. Find Equilibrium GDP.
The terms of trade if the united states trades 1 can of soda for 5 units of clothing.
Sketch the extensive form of the game, carefully labelling the players that move and the actions they have available
What are price indexes designed to measure. Outline how they are construed. When GDP and other and other income figures are compared across time periods.
Mining is proposed for a wilderness area that provides two benefits: recreation due to backpacking opportunities and biodiversity there are endangered wildlife and plants.
Trace out exactly where this 100 increase in income goes in the second round and compare to our simpler treatment with a closed economy and lump sum taxes.
Distinguish between the resources market and the product market in the circular flow model.
Given the demand and cost conditions, what price, output and profits result in the short run? What will happen as the firm moves from the short to the long run
Based on some economists' definition of the relevant market, the two firms proposing to merge enjoyed a combined market share of about two-thirds, while another firm essentially controlled the remaining share of the market.
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