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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?
what are the Sources of public debt
REGRESSIVE TAX A tax is said to be regressive when its burden falls more heavily on the poor than on the rich. No civilized government imposes a tax like this.
What is the role of scarcity in management decisions-making
External Debt Problem External debt refers to debt owing by one country to another. External debt is a more serious problem than internal debt because the payment of interest
Equilibrium in a two commodity market Let us consider a two-commodity market model in which the two commodities are related to each other. Let us assume the functions for bot
What is Normative economics It is concerned with varied corrective measures that a management undertakes under lots of circumstances. It deals with goal determination, goal dev
Balance of Payments Perhaps the most immediate reason for bringing in protection is a balance of payment deficit. If a country had a persistent deficit in its balance of paym
a) The production-possibilities curve is? b) If there is a shortage in the provider of a product, we can conclude that its price: c) An enhance in supply and a
what is the full concept of discounting principles of managerial economics ?
Contributions of economic theory to business economics According to Baumol, there are 3 key contributions of economic theory to business economics. 1. Practice of building
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