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1. Jack and Jill have decided to open a bakery together. For reasons nobody understands, Jack can bake as many as 20 pies or 10 cakes per day, but Jill can bake only as many as 15 pies or 9 cakes.
a. Which partner has the comparative advantage in cake baking? Explain.
b. Plot their combined PPC, including the number of cakes and pies at each of the three corners.
Could you reduce the cost of producing 1,800 pots per day by adding a pottery machine to your production process and reducing the amount of labor. Explain why or why not.
Case Study - Technology and Economic Change and what are the causes of economic growth in potential output in the long-term? Apply the theory to illustrate and explain your answer with an example.
What is Wirelesses' producer surplus from sales for each low-demand as well as consumer.
Changes in the macroenvironment affect individual firms and industry through the microeconomic factors of demand, production, cost and profitability.
Compute and plot yield spread (difference between yields to maturity of console and one-period bond). Is yield spread pro-cyclical or counter-cyclical.
Why does a reduction in taxes have a smaller multiplier effect than an increase in government spending of an equal amount.
Is this analysis consistent with the proposition which money has real effects in the short run but is neutral in the long run.
Explain how does the price elasticity of demand for corn oil influence the quantity-demanded of corn oil and the Total Revenue earned by sellers of corn oil.
The percentage effect which increase in output will have on the profit made from producing and selling commodity Alpha will be.
Which of following arguments is president using to justify trade restriction on ball bearings.
The payoff to a company that enters is its gross profit minus its entry cost, while the payoff to a company that does not enter is 60. Find a symmetric Nash equilibrium in mixed strategies.
Explain why do you think it is important for managers to understand the mechanics of supply and demand both in the short run and in the long run
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