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A manufacturing company wants to decrease its labor costs by substituting skilled welders with robot welding machines. If the company marginal tax rate is 36% is the investment a good idea?
MACHINE COST: $268,279
MACHINE INSTALATION COST: $18,727
DEPRECIATION: 7 year MARCS, half year conversion
SALVAGE VALUE @ YEAR5: $50,973
COMPANY MARR: 19%
WELDER SALARY: $56/hr, benefits 34%
Illustrate what happens when a per unit subsidy is replaced with a revenue equivalent lumpsum subsidy.
De Beers is a monopolist which supplies diamonds with constant marginal cost and constant average total cost. Draw the average cost, marginal cost, demand and marginal revenue curves. Show the price charged by De Beers without price discrimination. U..
Suppose the firm chooses this input combination. What is the firm’s short run cost function? What are the firm’s fixed costs? What are the firm’s variable costs?
"Consider the following statement: "Employers should be able to replace permanent workers during a strike." Do you agree? Explain why."
Are there any studies that explore the higher net present value (NPV) of education in countries with higher Gini coefficients? Additionally, do any of these studies include the impacts of economic mobility as a reducing factor of the NPV or price of ..
Layton Tire and Rubber Company wishes to set a minimum mileage guarantee on its new MX100 tire. Tests reveal the mean mileage is 67,900 with a standard deviation of 2,050 miles and that the distribution of miles follows the normal probability distrib..
A firm produces both crayons and pencils in constant proportions (1/3 and 2/3 respectively). Its costs are C(q1;q2)=1000+10q1+5q2+9q1q2, where q1 is the output of crayons and q2 the output of pencils. Calculate its minimum efficient scale (MES) of pr..
Joey, David, Tracy, and Surly own one track bicycle apiece, and they\'ve each modified to sell them as fixed-gear bikes or \"fixies.\" Joey is willing to sell his bike at $100 or more. Maintain the orientation of each bar when creating the graph (i.e..
A firm will have constant profits of $100,000 per year for the next four years and the interest rate is six percent. Assuming these profits are realized at the end of each year, what is the present value these future profits?
What is the role of models in economic analysis? How can it be determined if the assumptions underlying the design of an economic model are overly simplified or overly limiting? At what point do the assumptions invalidate the model? Why?
Assume that a police officer is conducting a valid stop and frisk for weapons. If evidence of drug possession inadvertently becomes known to the officer, probable cause for an arrest arises.
A firm has a production function represented by: q=L^(.75)K^(.25) Find a function for how much capital and labor a firm should hire to produce a given level of production in terms of the price of labor, w, and the price capital, r. Suppose w=15 and r..
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