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Suppose Ernie gives up his job as financial advisor for P.E.T.S., at which he earned $30,000 per year, to open up a store selling spot remover to Dalmatians. He invested $10,000 in the store, which had been in savings earning 5 percent interest. This year's revenues in the new business were $50,000, and explicit costs were $10,000. Calculate Ernie's accounting profit and economic profit.
Using the supply-and-demand model, explain what would happen to the supply curve during a drought. Also explain the effect on the price of water as illustrated by the graph.
q.the news reports which the exchange rate for the dollar just hit its lowest value in a decade it also reports which
When the bookstore announces a 20% price increase in new texts and a 10% increase in used texts for next year, Guojun's father offers him $80 extra.
Why is depreciation of capital good a cost of society. In illustrate what ways does a person's health depreciate. Why might older people's health care expenditures increase in Grossman model even though their desired health stocks may be lower.
how long would it take to pay back the investment for the required expansion? b. If sales are expected to increase at a rate of 15% per year, how long will it take to pay back the expansion?
Which of the following is closest to the equivalent annual worth of a project with an initial cost of $200,000, annual costs of $35,000, annual revenues of $95,000 and a salvage value of $10,000 after 7 years? Assume an interest rate of 10% per year.
A monopsony firm will not pay as much for factors of production as will a firm in a competitive market for inputs. Graphically, demonstrate the equilibrium solution for the monopsonist and explain why this is different than the competitive solution.
Assume that the demand for ethanol, a corn-based alternative fuel, decreases. As a result, ethanol producers petition the Environmental Protection Agency (EPA) to raise the allowable amount of ethanol in gasoline blends from 10 percent to 15 percent...
If the gini coefficient falls from .40 to .20
Consider the following conversation: Does the logic of the reader (G) make any sense, or does it violate economic reasoning?
If the marginal cost is a constant of 6, would that mean it is an economy of scale or diseconomy? My first thought was that it would be a diseconomy since I thought MC needed to approach zero for very large quantitities.
You are a division manager at Toyota. If your marketing department estimates that the semiannual demand for Highlander is Q = 80,000 −1.2P, what price should you charge in order to maximize revenue from sales of the Highlander?
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