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Why we need to distinguish between private cost and social cost?
What is optimal output rule? Optimal output rule: According to the optimal output rule, describe that profit is maximized through producing the quantity of output at that th
(a) Define and explain, using diagrams, consumers' surplus; producers' surplus and total surplus that a society can derive from production and consumption of a good at a particu
DIRECT TAXES A direct tax is one where the impact and incidence of the Tax is on the same person e.g. Income Tax, death or estate duty, corporation taxes and capital gains
NOMINAL RIGIDITIES VERSUS REAL RIGIDITIES Nominal rigidities are said to exist when nominal prices and wages do not change in the face of conditions that call for thei
Cheap Labour It is often argued that the economy must be protected from imports which are produced with cheap, or 'sweated", labour. Some people argue that buying foreign
Tomato Farm is selling tomatoes in a purely competitive market. Its output is 5000 bushels, which sell for $15 a bushel. At this level of output, the marginal cost is $15 bushel an
Q. Types of Market Structures by the Nature of Competition? Conventionally, the nature of competition is assayed to be the basic criterion for distinguishing different types of
Importance of Income Elasticity If a country is experiencing economic growth, the income of the people will increase. However, for those engaged in the production of goods wi
Suppose that Betsy's utility function is given by the equation U=Y0.3 where Y is calculated in thousands of dollars. Betsy's present job pays her $20,000 (Y=20) per year and she ca
Problem 1: a) Explain what is meant by ‘price discrimination' and what are the different types of price discrimination. b) Under what conditions is it possible and profitabl
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