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If a 10 percent fall in the price of beef increases the quantity of beef demanded by 20 percent and decreases the quantity of chicken demanded by 15 percent, calculate the cross elasticity of demand between beef and chicken. What can you conclude about the relationship between beef and chicken?
Consider the iron ore production industry, and assume that there are just two producers, FM and BHP. Initially assume that both firms are identical in terms of their production costs. If the two firms can cooperate, what should they do in order to ma..
What is the key problem with measuring marginal q? Is there an alternative measurement that can be used instead? Is this alternative measurement likely to be an accurate proxy for marginal q?
An investor is considering the construction of a new marina on the Detroit river at a cost of $68m. M&O costs will average $80,000 per year for the first five years, and rise to $100,000 per year thereafter. A major overhaul costing $12m will be requ..
An automobile company decides to do its bit for the environment by introducing new models of electric cars. The company's long-term goal is to eventually stop manufacturing gasoline cars and focus on manufacturing electric cars. The managers of th..
A key determinant of the price elasticity of supply is the:
Compute the price elasticity of demand when price changes from $100 to $80 per pair using the average formular.
Briefly explain the meaning of f test why do you think this test is considered to be more important in multiple regression analysis than it is in simple regression analysis.
Susan's Umbrellas has a production function given by Q = 10K0.5L0.5, where MPL = 5K0.5/L0.5 and MPK = 5L0.5/K0.5. Susan is using 9 units of capital (K) in the short run. The wage (W) is $80 per day and the rental rate per unit of capital (R) is $5 pe..
In the short run if the output growth is just 2% for two years and the equation determining the real interest rate changes to: r=4.5-%?Y, what money growth rate should the Fed aim for to hit its inflation target in that period?
Assume that you have a company and need to evaluate two alternatives, an automatic machine (AM) and a manual machine (MM). Capital investment for these AM and MM are $23,000 and $8,000, respectively. On the other side, we need to have three employee..
What would happen to unit sales and total revenue for this textbook if the bookstore reduced it's price? Is the demand for iPhones price inelastic or elastic? Why? Is income elasticity high or low?
The legal standard of proof that permits an officer to conduct a stop and frisk is:
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