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Suppose labor is the only cost of production and labor productivities (output per unit of labor input) in Japan and India are as follows:
(a) If these are the only two nations who trade, and consumers in both countries demand all three goods (the only ones that are available), explain what you can conclude about the comparative advantage of each country.
(b) Within what limits must the ratio of Japanese wages to Indian wages settle when trade is possible? If that ratio turns out to be 5.5, what goods will each country export and import?
How much substitutability do you suppose exists between inputs in winemaking?
You are an assistant to a senator who chairs an ad hoc committee on reforming taxes on telecommunication services. Based on your research AT&T spends $15 million on related paper work and compliance costs. Depending on the locale, telecom taxes ca..
Suppose the cost of treating the child with leukemia is $100,000, paid as a lump sum 100 years from today. Using a discount rate of 5%, what is the present discounted value of this cost?
Suppose a firm's short-run total product schedule is given in the table below. It sells its output in a competitive market for $1.50 per unit. a. Complete the table. How many workers will this firm hire at a wage of $7 b. If the wage rises to $9, h..
Explain why the interest rate might affect saving.
Atlas Long-Haul Transportation is considering installing Valutemp temperature loggers in all of its refrigerated trucks for monitoring temperatures during transit. If the systems will reduce insurance claims by $40,000
let E1 denote his expenditure at the end of this year and E2 denote his expenditure at the end of next year. At the end of this year he will receive $100,000 in income, and at the end of next year, he will receive $105,000 in income.
Using your favorite spreadsheet software, compute the debt-to-GDP ratio in 10 years, assuming that the primary deficit stays at 4% of GDP each year; the economy grows at the normal growth rate in each year; and the real interest rate is constant, ..
Let's evaluate the expected impact of the introduction of overtime pay on hours of work. Consider three cases. First suppose that before the overtime pay is started the optimal choice of hours is 5 hours per week.
Adrian is about to borrow $2350 from his uncle. He has an option to repay the loan at the end of the year 5 with 10.75% interest per year or with 5% interest per year compounded annually. What is the difference of the total interest paid over 5 ye..
when does an auditor do analytical procedures?
You have made deposits of $1000 per year in an investment account at the end of each year (beginning at the end of the first year) for ten years. The account earned 6% compounded annually for the first 5 years and 9% compounded annually.
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