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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?
Using the CD data estimate a quadratic cost function. Test the hypothesis that there is diminishing marginal cost. Be sure to state what critical value you are using. Then, using t
Planned Economy Is a system where all major economic decisions are made by a government ministry or planning organisation. Here all questions about the allocation of resources
What market type does the company you work for operate under? What makes you think this? Do you think that this is the right market type for your company to operate in? Explain you
distinguish between industry demand and firm company demand
Explain how managerial economics is useful for decision making
Q. Explain about Linear Isoquant? : In this case, isoquant would be straight lines as in Figure below. This type presumes perfect substitutability of factors of production. I
Q. Explain Maximising revenue method? In a number of cases, a firm's demand and cost conditions are such that marginal profits are greater than zero for all levels of productio
Real Rigidities in the Labour Market New Keynesian theories of the labour market help in explaining the existence of involuntary unemployment. The theories also attempt to
different types of markets and role in managerial economics
Q. Controlover Supply of Inputs - sources of monopoly? Furthermore, a monopoly situation may arise because of control over the supply of an essential input -skilled labour, raw
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