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A monopoly firm faces a demand curve given by P = 80 – Q and has a cost curve given by TC = 0.6Q^2. Specify and demonstrate its optimal output, price, and profits. Now suppose a specific tax of $16 per unit produced is imposed upon this firm; specify and demonstrate how this tax affects the firm’s optimal output, price and profits. Suppose instead a fixed “franchise tax” of $160 is levied upon the firm; specify and demonstrate how this tax affects the firm’s optimal output, price, and profits. Finally, suppose a “corporate profits tax” of 50% is levied upon the firm; specify and demonstrate how this tax affects the firm’s optimal output, price, and profits.
In a situation of first-mover advantage, a strategic move would be to:
What if the government needs to purchase a single, large piece of property in order to provide a public good, say, a satellitetracking station? There is only one private owner with whom to deal. And his property is the only one that is suitable for t..
These three empirical observations are explained by ‘Preferred Habitat theory'. First, completely explain Preferred Habitat theory. Next, explain how this theory explains all three empirical observations.
Why is economics a science of choices? Explain the kinds of choices confronting workers and employers in labor markets. Distinguish between microeconomics and macroeconomics.
An automatic veto that occurs when Congress goes out of session within ten days of submitting a bill to the president and the president has not signed it, is known as
As asset is purchased in September and is being depreciated over 7 years using MACRS 200% Declining Balance depreciation switching over to Straight Line Depreciation, witht he mid month convention. In what year should the depreciation method be switc..
As an owner of a visible U.S. business that is valued in the community, you are making a final decision regarding the international aspects of a business decision, and you decide to set up a table with various risks.
Why does the assumption of independence of risks matter in the examples of insurance.
The ABC Corporation is contemplating purchasing a new computer system that would yield a before-tax return.
As the Euro appreciates in value relative to the U.S. dollar, what happens to the price of U.S. goods in Europe. Elucidate what happens to the price of European goods in the U.S.
When the world price of some good is above the domestic price (before trade), then after trade, that nation will likely be:
TT Drinks Company was established a hundred years ago and currently employs over 300 people. The company produces and sells a range of black, green and flavoured teas and fruit infusions. TT's last Director of Marketing was away from work with illnes..
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