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What is the difference between a profit and a rent? If a firm is interested in maximizing profits, why would it stay in an industry if profits are zero?
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In the text, we suggested that for well-off individuals with uniform taxation, preferences for education were not single-peaked. Why might preferences for local parks and urban public transportation systems (e.g., buses and subways) also not be singl..
Other things being equal, what will happen to automakers' profits if they are able to sell more vehicles using battery packs and thereby scale up battery production? Why do you suppose that some automakers support the payment of government subsidies ..
A monopoly consumer durable company faces a demand curve (in $) for its branded product described by P = 20 - 3Q. Its average variable cost equals $2 everywhere, up to its capacity level of 20 units of output. Fixed costs are equal to $10. There is n..
Suppose a union that represents some but not all of the employees in an industry is considering a strong push for increased pay for their members during the upcoming contract negotiations. However, they are concerned about the possibility that the co..
Why is each the policy necessary? The welfare of consumers, producers, and society (the winners and losers) before and after the policy
For the closed-economy, one-period model, suppose that U (C, l) = min (C, β × l), and F (K, N) = αK + δN, where β > 0, α > 0, and δ > 0. Determine consumption, employment, output, leisure, and the real wage in a competitive equilibrium, and explain y..
Suppose velocity is constant, the growth rate of real GDP is 3% per year, and the growth rate of money is 5% per year. Calculate the long-run rate of inflation according to the quantity theory of money. Suppose the growth rate of money rises to 10% p..
The marginal product of any input in the production process is the increase in the quantity of output produced from one additional unit of that input. According to the Law of Diminishing Returns, the marginal product of an input declines as the quant..
Efficiency of labour refers to the ability to achieve a greater output in a shorter time without any falling off in the quality of the work - that is to say, increase productivity per man employed. The efficiency of a country's labour force depend..
for a child i living in a particular a school district let voucher be a dummy variable equal to one if a child is
Assume that you are going to start a small business of your own. Further, imagine that you are able to adequately differentiate your product, or service so that you can establish your business as a monopolistically competitive firm. Describe the busi..
Use a supply-demand graph to demonstrate how the quantity and price of medical services are expected to be affected if we went from a world without insurance to a world where the government covered 90% of all medical costs.
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