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Listed here are several examples of bad, or at least questionable, decisions. Evaluate the decision maker's approach or logic. In which of the six decision steps might the decision maker have gone wrong? (a) Mr. and Mrs. A recently bought a house, the very first one they viewed. (b) Firm B has invested five years and $6 million in developing a new product. Even now, it is not clear whether the product can compete profitably in the market. Nonetheless, top management decides to commercialize it so that the development cost will not be wasted. (c) You are traveling on a highway with two traffic lanes in each direction. Usually traffic flows smoothly, but tonight traffic moving in your direction is backed up for half a mile. After crawling for 15 minutes, you reach the source of the tie-up: a mattress is lying on the road, blocking one lane. Like other motorists before you, you shrug and drive on. (d) The sedative thalidomide was withdrawn from drug markets in 1962 only after it was found to be the cause of over 8,000 birth defects worldwide. (An exception was the United States, where the use of thalidomide was severely restricted).
Desired Aggregate Spending Desired aggregate spending refers to the volume of purchases of the currently produced goods and services that all spending units in the economy wish
Suppose the price elasticity of demand for used cars is estimated to be 3 what does this mean?
Neo-classical synthesis is a synthesis of classical model and Keynesian model. In brief, it states that Keynesian model is correct in the short run whereas the classical analysis i
Illustrate the three approaches of measuring national income? Show that these three approaches give identical result. Explain private saving. How is the private saving used
Use the model in the tax incidence application to determine the effect of a given change in the tax on widget, change in T, on the equilibrium quantity of widgets. How does your an
You are the manager of a firm that receives revenues of $40,000 per year from product X and $90,000 per year from product Y. The own price elasticity of demand for product X is -1.
Q. When Ochratoxin molds can occur? Ochratoxin A is a phenylalanyl derivative of a substituted isocoumarin produced by Penicillium verrucosum in temperate climate and by severa
Production Alternatives Type of production A B C D E Automobiles 0 2 4 6 8 Forklifts 30 27 21 12 0 If the economy is at point C, what is the (opportunity) cost of 2 more automobile
Public policies often alter the costs and benefits of private actions. Why is it important for policymakers to consider both the direct and indirect effects of public policies? Sel
Marginal Propensity to consume or known as (MPC) relates to a change in net or total consumption expenditure to a change in the total disposable income. Symbolically it is writt
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