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Split the Difference for a Pollution Permit. Consider two firms, each of which is issued three marketable pollution permits. For firm H, the marginal cost of abatement is $190. For firm L, the marginal cost of abatement is $130.
a. Is there room for a mutually beneficial exchange of one permit? If so, which firm will buy a permit and which firm will sell a permit?
b. If the two firms split the difference, whats the price of a permit?
c. Suppose that after the exchange of one permit, the marginal cost of abatement for the firm that soldthe permit is $170 and the marginal cost of the firm that bought the permit is $150. Will the firms exchange another permit, or are they done trading? d. What is the savings in abatement cost from allowing firms to buy and sell a permit?
What is the multiplier? How is it calculated? Why is the multiplier related only to consumption spending?
ABC Corporation's recently issued bonds paying interest semiannually and maturing in 10 years. The face value of each bond is $1000, and 6.8% is the nominal interest rate. (a) What is the effective interest rate an investor receives.
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The firm currently uses 50,000 workers to produce 200,000 units of output per day. The daily wage per worker is $80, and the price of the firm's output is $25. The cost of other variable inputs is $400,000 per day.
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A friend of yours is considering two cell phone service providers. Provider A charges $120 per month for the service regardless of the number of phone calls made. Provider B does not have a fixed service fee
If the marginal propensity to consume for an economy as a whole is 0.75, what is the simple multiplier equal to? If governments spend 1 billion dollars, how does this translate into a greater than a $1 billion impact on the economy.
Suppose the residents of Vegopia spend all their income on cauliflower, broccoli, and carrots. In 2005, they buy 100 heads of cauliflower for $200, 50 bunches of broccoli for $75, and 500 heads carrots for $50. In 2006, they buy 75 heads of caulif..
the following data are collected for a computer manufacturer companyquantity price per unit total cost of
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