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Suppose in Solved Problem 7.2 that the government charges the firm a franchise tax each year (instead of only once). Describe the effect of this tax on the marginal cost, average variable cost, short-run average cost, and long-run average cost curves.
Problem 7.2
Carmen bought a $125 ticket to attend the Outside Lands Music & Arts Festival in San Francisco. Because it stars several of her favorite rock groups, she would have been willing to pay up to $200 to attend the festival. However, her friend Bessie invites Carmen to go with her to the Monterey Bay Aquarium on the same day. That trip would cost $50, but she would be willing to pay up to $100. What is her opportunity cost of going to the aquarium?
On what sources does an auditor base his expectations
Suppose Tom and Jennifer placed $5,000 into a savings account that paid an interest rate of 6 percent. If the inflation rate was 4 percent over the year, what was the ex post real interest rate return
Compare the work incentives of the wage subsidy and the negative income tax for the entire income distribution. Use a diagram and explain.
Kawin is a small country that produces and consumes jelly beans. The world price of jelly beans is $1/bag, ad Kawmin's domestic demand and supply are governed by the following equations: Demand: Qd = 8 - P
Every student enrolled in Economics 101 must also attend a weekly tutorial. This year there are two sections offered: section A and section B, which meet at the same time in adjoining classrooms and are taught by equally competent instructors. Sec..
In the preceding question, assume that new cars sell for $18,000 and used cars sell for $2,000. If there is no depreciation and risk-neutral consumers know that 20 percent of all new cars are defective, how much do the consumers value a non defect..
If an insurance company were offering life insurance to the entire group, but could not find out about family cancer histories, what would be the actuarially fair premium for the group as a whole? c. What will happen to the insurance company if it..
Calculate the price elasticity of demand for gasoline implied by what most studies have found.
Apart from official GDP statistics, what other information might suggest that an eco-nomy is heading towards a recession (defined as more than two consecutive quarters of falling output)?
Describe the business and, utilizing the concepts of this unit and the earlier units
Consider the expected return and volatility of returns for Coca-Cola and Intel. Assume thatthe assets are perfectly negatively correlated, i.e., their correlation coefficient is ρ = -1.Asset Expected Return VolatilityE(R) σ(R)Coca-Cola 0.09 0.12Intel..
What procedures should the auditor follow to substantiate that all wells owned by the company are properly recorded, classified, and valued? What supporting evidence would the auditor examine in this connection? [CICA adapted]
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