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Problem 1: All economies of the world can be said to be ‘mixed', to a greater or lesser degree, in that there is no economy where there is no state activity and no economy wher
Consider an economy with three assets and three states. Let be the matrix of asset payoffs at t=1 and p the vector of asset prices at t=0. Assume p 3 =2. a) Does an ar
Joe is evaluating the marketing strategy at his restaurant and inn. Suppose that in response to a $2.00 off sales promotion for spaghetti dinners, Joe finds that nightly dinner sal
neoclassical thinking assumes that all firms are established to make profit has been challenged by managerial discretion model.How successful have been these models to maximize pro
Marginal Revenue Marginal revenue is the additional revenue an organization receives resulting from the sale of one more item of output. Marginal revenue is calculated by takin
Cross Elasticity Cross elasticity of demand measures the degree of responsiveness of the quantity demanded of one good (B) to changes in the price of another good (A). It is
fundamental concepts of decision-making theory The fundamental concepts of decision-making theory have been culled from microeconomic theory and have been furnished with new t
Price elasticity of demand The price elasticity of demand is defined as the degree of sensitiveness or responsiveness of demand for a commodity to the changes in its price. Mo
NATIONAL DEBT Taxation does not often raise sufficient revenue for the Government Expenditure. So, governments resort to borrowing. This government borrowing is called Publi
Why we need to distinguish between private cost and social cost?
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