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The only road connecting two populated islands is currently a freeway. During rush hour, there is congestion because of the heavy traffic. The marginal external cost from congestion rises as the amount of traffic on the road increases. At the current equilibrium, the marginal external cost from congestion is $5 per vehicle. Would a toll charge of $5 per vehicle lead to an economically efficient amount of traffic? If not, would you expect the economically efficient toll to be larger than, or less than $5?
One lumber producer may locate a plant in the same area. If it does, there will be more competition for labor and the labor supply function facing Northern will shift to
bargaining power of customer for a cement company
State the Specific Time of demand Demand should be assigned specific time. For instance, it is an incomplete proclamation to state that demand of air conditioners is 4,000 at t
Consider a manufactured good whose production process generates pollution. The annual demand for the good is given by Qd=100-3P. The annual market supply is given by Qs=P. In both
Q. Total cost of Factor Combinations? Here we try to find total cost of every factor combination and choose the one that has the least cost. Cost of every factor combination is
Explain about the marginal analysis. The optimal quantity of an activity is the level which produces the maximum probable total net gain. The principle of marginal analysis
Functions of Commercial Banks In modern economy, commercial banks have the following functions: i. They provide a safe deposit for money and other valuables. ii.
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
what are the objectives of a firm
Apprehensions about the future price of law of demand When consumers anticipate a constant rise in the price of a long-lasting commodity, they buy more of it despite the price
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