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Suppose that a firm has a budget of $30,000, that the wage rate is $10 per hour, and that the rental rate is about $100 per hour. I f the wage rate increases to $15 per hour and the rental rate of capital rises to $120 per hour, what happens to the producer budget or cost line? What will happen to the equilibrium of level output because of this change in factor prices? What will happen to the relative usage of labor and capital because of the change in factor prices? Explain.
Reaganomics Supply-side economics or New Classical Economics has gained distinct prominence in the early 1980s with the election in the U.S.A of a conservative government unde
Consider an economy with the following characteristics: i. The price-level is fixed ii. The economy is closed (Exports - Imports = 0) iii. Government spending (G) and Inve
objective of the study
Assume two individuals, A and B, are considering marriage, and each face the same amount of hours a week to be split between market-labor and home-labor. Assume that A can make $2
What factors find out the price elasticity of demand? Factors which determine the price elasticity of demand are: a. Whether close substitutes are accessible b. Whether t
Subsidy programs are likely to have a number of secondary effects in addition to the direct effect on dairy prices. What impact do you suppose farm subsidies are likely to have on
A nursing home contracts with an HMO for skilled nursing care at $2.00 PMPM. If costs are expected to average $120 per day, what is the maximum utilization of days per 1,000 member
define production function output effect?
You should now find a press release from the Board of Governors of the Federal Reserve System, dated December 16, 2009, which discusses the decisions of the Federal Open Market Com
Analyze how taxes and subsidies impact market efficiency. Speculate if market efficiency would be increased or decreased without issues of taxes and subsidies. Justify your respons
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