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Q1. Given production function f(x,y)= (cx^[a+b])(y^[b-a])where a, b, c are positive and b>a,
a. Discuss the returns to scale, marginal product of inputs, and technical rate of substitution. Show that whether they are increasing, constant, or decreasing?
b. Given the cost of x and y are w and u, and the price of output is p, find out the best inputs levels that would benefit you the most.
Q2. Use a model of the money market to explain why changes in nominal or money GDP are associated with changes in interest rates. Theoretically, how could changes in the money supply be used to keep interest rates at the same level?
q. you have been hired to manage a small manufacturing facility whose cost and production data are given in the table
How does this policy involve the supply and demand for loan able funds. What occurs to the equilibrium interest rate.
Illustrate would be the effect on D' of decreasing the variable cost per unit by 25% if the fixed costs thereby increased by 10%.
Why all the balance of payments accounts be in surplus. What factors determine the demand for British pounds in foreign exchange markets.
Illustrate what is the airline's profit-maximizing fare? How many passengers does it carry per week, using how many flights.
Suppose the government intends the tax to reduce the consumption of some goods for example, cigarette or chewing gum. Illustrate what will determine the effectiveness of the tax in reducing consumption
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Expalin why is the depreciation of capital good a cost of society
Say you are the manager of a perfectly competitive firm selling a product. Your business is making a loss because total revenue is less than total costs.
Even though the use of checks lower transaction costs when compared to the use of paper currency, it is unlikely that the use of paper or metallic currency will disappear entirely. Why?
rom the Blades' Use of Long-Term Financing case study, formulate an overall corporate financial strategy to support the long-term financing of Blades, Inc.
When prices are ($4, $2), Valerie chooses the bundle (9, 18), and when prices are ($1, $2), she chooses the bundle (8, 14). Is Valerie's choice of bundles consistent with the Weak Axiom of Revealed Preference.
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