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How much would the owner of a building be justified in paying for a sprinkler system that will save $750 a year in insurance premiums if the system has to be replaced every 20years and has a salvage value equal to 10% of its initial cost? Assume money is worth7%
Derive graphically the long run supply curve for an increasing cost industry. Provide some explanation with your graph.
Suppose there are two types of customers for a cell phone service: undergraduates (U) and grad Students (G). The aggregate (inverse) demand curve for undergraduates is PU = 100 − 0.25QU and the aggregate (inverse) demand curve for the graduate studen..
What do economists mean when they say that "price floors and ceilings stifle the rationing function of prices and distort resource allocation" Use the ideas of consumer surplus and producer surplus
Festwalia has two types of workers: low-skill workers, who earn $10 per hour, and high-skill workers, who earn $20 per hour. The government of Festwalia currently imposes a 20% proportional tax on all labor earnings. It is considering replacing this ..
Briefly explain relationship between market price and a firm's profitability in a perfectly competitive market. How are the Zero profit point and the shutdown point for a firm operating in a perfectly competitive market determined?
A rolled model product company purchased a machine for ram clambering large I- beam. The company expects to bend 95 beam at $2000 per beam in each of the first year, after which company expects to bend 125 beams per year through 9 years. If the compa..
When the accounting profit equals the implicit costs, the firm earns
Trade restrictions raised the price of sugar by 2.57 cents. Without the restrictions, U.S. consumers would have purchased 23.3 billion pounds of sugar; with them, they purchased 22.4 billion pounds. How much of a loss do they impose on U.S. consumers..
Suppose the utility granted by spending holidays domestically D and holidays in foreign countries F is represented by the utility function u(D,F)=10D*F. You have a budget of 4000 US-Dollars and a domestic holiday costs you 100 US-Dollars per day and ..
Explain why total revenue doesn't always increase when price is raised. Explain why the issue of firm interdependence makes modelling firm behavior under oligopoly so difficult. Why is so important to seasonally adjust data?
Suppose that some foreign countries begin to subsidize investment by instituting an investment tax credit. What happens to the investment in our small open economy? What happens to our trade balance? What happens to our real exchange rate?
Discuss political economy of euro. What are likely economic effects of euro. What are its likely political effects. How is euro supposed to solve EU's political problems. Explain
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