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1. Suppose the wage rate is w = 1. An agent is working 6 hours per day and consumes 5 units of goods per day. Suppose that the agent claims to be indifferent between his current situation or working one more hour in exchange for two additional units of consumption. Is this agent maximizing is utility? Why? Should he be working more hours? or fewer?
how does the concept of possibility production curve aplicable in real life?
In the city of Gelato the market for ice cream is perfectly competitive. Aggregate demand for ice cream is: D(p) = 1200-25p where p is the price for one cone of ice cream. Al
DETERMINATION OF FIXED EXCHANGE RATE: In the flexible exchange rate regime, exchange rates are highly volatile which leads to uncertainties in the international payments/trans
In fall 2006, Pace University raised its annual tuition from $24,750 to $29,750. Freshman enrollment declined from 1500 in fall 2005 to 1110 in 2006. assuming the demand curve did
NEER Vs REER: In a situation where there are multiple trade partners, the effect of cross-currency movements are judged by nominal effective exchange rate (NEER) and real effe
meaning of economics laws
Illustrates the stages of the production of an economic conclusion? The production of an economic conclusion generally goes into three stages as follows: Stage 1: It is no
It is clear that monopsony in the labor market is not steady with allocative efficiency and has the effect of withholding significant amounts the employees' MRP from them, that bec
Commodities that are viewed as luxuries typically have price elastic demand, and commodities that are requirements have price inelastic demand. There is easily no substitute for a
A monopolist faces the following demand function for its product: Q = 45 - 5P The fixed costs of the monopolist are $12 and the variable costs are $5 per unit. a) What are the
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