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It is estimated that the maintenance cost on a used car will be $300 the first year. Each subsequent year, the maintenance cost will increase by $50. At an interest rate of 6% per year, what is the equivalent equal uniform annual cost of maintaining the car for its 10 year life?
(Can you please show all work)
Economist tell stories as the vending machine story:
As we observed in this chapter, central banks, rather than purposefully setting the level of the money supply, usually set a target level for a short-term interest rate by standing ready to lend or borrow whatever money people wish to hold at that in..
The direct and excess burdens from an excise tax are greater the less elastic is demand in the market. Real national income can never exceed its potential level.
We have discussed why market based policy instruments are often superior to conventional command–and control instruments to solve environmental problems. But command -and-control regulations, such as a uniform standard for all polluters, sometimes wo..
You and your neighbor both enjoy live performances by Katy Perry. Your neighbor is quite well o? and has been hiring Katy Perry to perform in their apartment. Katy Perry charges $5,000 per hour to perform at someone’s home. Your neighbor’s demand for..
Consider a river, with no associated property rights. A downstream resort uses the river for fishing and swimming, for guests. An upstream feedlot uses the river for waste disposal. What is the market determined equilibrium level of abatement? What w..
Project LMN has an initial cost of $10,000 and annual cash inflows of $2,825, $3,192, $3,607, and $4,076 in years 1–4. What is the NPV assuming a 12% discount rate? When the project was completed, none of the cash flows were reinvested. Sum up the ca..
Bob's lawn-mowing sevice is a profit-maximizing competitive firm. Bob mows lawns for $27 each. His total cost each day is $280, of which $30 is a fixed cost. He mows 10 lawns a day. What can you say about Bob's short-run decision regarding shutdown a..
Is Walmart Good for America? Read John Miller, “What’s Good for Wal-Mart” (article 4.4 in Real World Micro). Are lower prices at Wal-Mart necessarily good? Would it be a good or bad thing if Wal-Mart raised wages and raised prices? What would you nee..
Assuming fuel is one of the main inputs for many sectors. When a war breaks out in Country X, which is the main producer for fuel in the world, it causes fuel supply disruptions in the world.
Suppose you have three people who are suggesting three social welfare functions for a society of five persons. Person 1 suggests the sum of the utility of each individual (U1+U2+U3+U4+U5). Person 2 suggests using the minimum utility of each individua..
If the average adult produces $90,000 of output per year, how much output is lost as a result of adult deaths from secondhand smoke, according to the News on page 74?
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