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A maker of specialty soaps supplies a unique soap made from cactus extract to the only two retailers in a small town. The producer sells the soap to the retailers at the marginal cost of production of the soap, $1.00 per bar, and receives 20% of the profit earned when the retailers sell the soap to customers. Would the producer prefer that the retailers compete with each other on price or to specify the retail selling price of the soap to both retailers?
What is the rationale behind the Taylor rule?
Explore the differences between economic model, economic theory, and economic policy. How would you explain this to a friend who has no clue what the differences are. Compare and contrast.
Use a diagram to explain the following: In the case of perfect substitutes, if the ratio of input prices equals the MRTS, will a unique solution to the firm's cost-minimization problem exist? In the case of perfect substitutes, if the ratio of input ..
A laundry cleans white clothes using Clorox bleach or generic bleach. The Clorox bleach is twice as "productive" as the generic, or twice as potent. To clean a basket of white clothes, you need a scoop of Clorox, or two scoops of the generic bleach. ..
Discuss how your expected and disposable future income, after receiving your college degree, may change your saving and investment decisions and transactions in the loan able funds market
Twin brothers Ryan and Mike co-own Stamps and More, an independent shipping business they established shortly after graduating from college. While initially struggling during the first two years of operation, the business eventually turned a profit i..
Identify the nature of the “pitfall” to sound economic reasoning represented by the following circumstances: You are attending a concert and recognize that you will have a better view of proceedings if you stand—hence if everybody stood…everybody wou..
On April 1, 2009, in the middle of a recession, the government of the province of Ontario, Canada increased the provincial minimum wage from $8.75 to $9.50. What will the likely effect of this policy be? Both the leftward shift in the labor demand cu..
Suppose the average driving distance for the 2011 Masters Golf Tournament was 282.5 yards with a standard deviation of 12.2 yards. A random sample of 30 drives was selected from a total of 4,144 drives that were hit during this tournament. What is th..
Discuss how an imperfectly competitive firm resorts to price discrimination to maximize its profits. One of the criticisms of oligopolies is the adverse impacts these firms have on income distribution. Do you believe that is a valid critism? Discuss ..
During our last recession, many employers opted to freeze wages, lower wages, and decrease their current labor force; therefore, does this align with Keynesian Theory? Is Keynesian Theory only applicable in the short-run as opposed to the long run? P..
Illustrate what would be the most likely maximum possible loss per share if you simultaneously place a stop-buy order at $128.
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