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What role does elasticity have on decisions made in the market? How does the availability of substitutes affect the price elasticity of demand? Explain using examples from your experiences.
Illustrate what will be the cumulative effects including the multiplier for each of the above three policy choices.
Explain basic idea behind Big Push model. How can O-ring theory help explain existence of a low-level equilibrium that an economy may find itself.
A perfectly competitive firm’s cost of producing q units of output is T C = 18 + 4q + q2. Its corresponding marginal cost is MC = 2q + 4. The firm faces a market price p = $24. Determine the profit-maximizing output for the firm and the corresponding..
Elucidate how that a profit-maximizing bundle will typically not exist for a technology that exhibits increasing returns to scale
Show that consumer surplus when the monopolist innovates is lower than the consumer surplus that obtains when the entrant innovates.
Illustrate why the store's short-run equilibrium by plotting demand marginal revenue, average total cost,and marginal costs.
Suppose that the State of Connecticut decides to subsidize the cost of purchasing a treadmill for cardiac patients, as prescribed by their doctors. Prior to the program, the equilibrium price of treadmills was $800, and the equilibrium quantity purch..
Assume an open, mixed economy (C+I+G+X=real GDP) and an MPS of .2 What is the multiplier? if the government spending (G) increases by $50B, how much will the real GDP increase? If taxes also increase by $50B, consumption (C) will fall by how much?
In an oligopoly game, the incentive to cheat is reduced when:
Please try to come up with real examples: it's not enough to say which savings account decreased.
A firm has a production function given by q=2 sqrt(KL) In the short run, the firm’s amount of capital equipment is fixed at K=100. The rental rate for K is v=$1, and the wage rate for L is w=$4. Find the firm’s short-run total cost function (STC). Ca..
Critically examine the importance of cargo handling technology for a developing nation container port attempting to boost trade in order to achieve economic growth.
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