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optimal contracts under symmetric information
3, chapter 12
Question 1 (9 marks) During the 1990s, technological advance reduced the cost of computer chips. Explain, with the use of supply and demand diagrams, how the following mark
large firms charge the price which is higher than the small firms, contruct the diagram
Neutrality: Bureaucracy is apolitical and neutral. Prof. Frocderich mentions the following features of bureaucracy: (i) differentiation of functions, (ii) qualifications for o
Exchange Rate Policy: LERMS, a dual exchange rate system, was introduced in the Budget for 1992-93. Under this system, 40 per cent of foreign exchange earnings were to be sur
TC = Q3 – 8Q2 + 68Q + 4
Island Economy: Consider an economy as a sea with islands of local markets. Each household produces goods and sells them on one and only one of the arrays of these markets. Go
Imagine a country where plane and train services between two main cities are both provided by private companies, and, from a consumer perspective these services are viewed as subst
(i) When the demand function is 2Q - 24 + 3P = 0, find the marginal revenue when Q=3. (ii) Given the demand function 0.1Q - 10 +0.2P + 0.02P2 =0, calculate the price elasticity of
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