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The solution to Externalities
Suppose the U.S. government determines that cigarette smoking creates social costs not reflected in the current price of cigarettes in the market. A study has recommended that the government can correct for the externality given the effect of cigarette consumption by paying farmers not to plant tobacco used to manufacture cigarettes. Assuming that the government is correct that cigarette smoking creates external costs, evaluate where the studyâ??s recommended policies might help correct this externality. Why does the presence of externalities not reflect societyâ??s costs and benefits in the market? Why are markets considered to fail the appropriate allocation of resources that are needed in the market? When answering the question, make sure to evaluate it from the different stakeholders that are present in the market.
Explain how does the Central Bank measure the money supply in the contary. Does the Central Bank have an interest rate policy.
Illustrate the quantity of laptops demanded, the level of imports of laptops, the price paid for laptops and the consumer surplus
Briefly describe and critically possible short-run and long-run macroeconomic effects of this continuous increase of the federal fund rate
Illustrate what effort does the principal want to induce when effort is not observable. Illustrate what is the optimal contract for the principal.
The organization will pay a $11 dividend in thirteen years and will increase the dividend by 5.5 % every thereafter. If the required return on this stock is 13%.
Illustrate the point price, income, also cross elasticities at the present values. Interpret your answers, saying how much a 1% change in each variable impacts demand.
Illustrate what would you expect to happen in the general economy if these rates are all increased.
Explain how does inflation affect an company's decision-making process.
Elucidate three manufacturing companies that experienced large percentage increases in the number of firms between 1997 and 2002.
A recent McKinsey report concluded that 'If a price war occurs in a specific market-Critically examine this statement.
What is the impact of this on the revenues of the networks also why.
An rise in a firms expected growth rate would normally cause the firms required rate of return. which of the following statements is most correct.
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