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Andrew has decided to open an online store that sells home and garden products. After searching around, he chooses the software company Initech to provide the software for his website since their product required the least amount of specialized investments for him to use it. They agreed upon price of $4,000. To use Initech's software. Andrew makes $2,000 in sunk capital investments and spends 60 hours learning how to use Initech's software, which is very different from other software packages. Both Andrew and Initech view Andrew's time as worth $28 per hour and Initech is fully aware of the investments Andrew must make to use their product. After Andrew's investments were made, Initech came to Andrew and asked for more money. How much do you think they asked for?
Explain how does one construct a linear (or other mathematical program) to solve a competitive or walrasian equilibrium problem.
The monopolist's marginal cost of production is constant at $11 per product unit. What is the size of the deadweight loss caused by the monopolist choosing to supply 10 units of its product?
Consider the Great Recession of 2007-2009, explain what you would expect to observe in the labor market during the recession and then explain what you would expect to observe in the labor market five years later. Questions to consider when formulatin..
Discuss the positive aspects of globalization, and contrast these with the negative aspects of globalization from the perspective of a small business. Be sure to address the pros and cons of outsourcing in your response.
Explain why do changes in bank reserves resulting from open-market operations by the fed produce multiple changes in checkable deposits in the economy.
In response to the Great Recession a number of European governments adopted aus- terity policies which cut government spending on goods and services. Assuming no change in autonomous consumption or in autonomous investment, explain whether such an au..
If David's only illness this year results in an appendectomy, explain how many days will he choose to stay in the hospital
Alternative B is for reforming the disability system is to maintain the old benefit levels (for those who receive them) but allow workers to earn up to $300 a month and still keep their benefits. Those who earn over $300 per month would lose all DI b..
Sergei is a computer programmer with a utility function equal to U=Y+120L-L . He contracts with Uber that allows him to set his own work hours; they pay him $50/hour. He has allocated himself a work-hour time budget of a maximum of 250 hours per mont..
If a government’s money is backed by gold and global instability causes its mint parity rate to become to high as a result the country falls into a depression, can the governments central bank fight the recession by increasing the money supply? Expla..
It is well known that, at times, public administrators have to make unpopular decisions. Propose two (2) leadership skills that are required for making difficult decisions in the current political environment. Next, propose two (2) actions that publi..
Assume that the MPC=0.6 for every consumer in the economy. You have just received a tax cut of $20000. How this action by the government will affect your spending plans? What would be the total effect on the economy of this action? (Assume that t=0, ..
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