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When the price of a new Toyota Corolla was $20,000, a dealership sold 15 cars in one week. The car was put on sale with incentives worth $4,000 (cash). As a result, the same dealership sold 22 cars in next week. Calculate price elasticity of demand and interpret your result. You must show your work.
Suppose that the Fed sets the interest rate and adjusts the money supply accordingly (i.e., horizontal LM curve) and the economy is in recession.
Chrysler engineers helped Toyota develop its Sienna minivan. In return, Toyota provided input on automobile production techniques to Chrysler. Why do you think Chrysler was willing to share its minivan know-how with a key competitor?
How much should be invested in each type of bond under the following? conditions?
Consider an open economy like Australia with free capital mobility and a floating exchange rate.
Jetways Airline flies passengers between New York and Miami, making one round-trip daily using a leased Boeing 737 aircraft. Consider the number of passengers served daily as the output for the airline. Identify each of the following costs as either ..
If these are the only two firms supplying gadgets, elucidate the elasticity of supply in the market for gadgets.
1. two investments have the following expected returns net present values and standard deviation of returnsproject
Suppose we investigate a particular example of a model with no government. Suppose the consumption function is given by C=100+.8Y, whereas investment is given by I=50. What is the equilibrium level of income in this case? What is the level of saving ..
Describe the effects of an increase in the tax on labor income.
Return to Figure 9.2. Suppose P0 is $10 and P1 is $11. Suppose a new firm with the same LRAC curve as the incumbent tries to break into the market by selling 4,000 units of output. Estimate from the graph what the new firm’s average cost of producing..
Jim sees commuting by bus and T as perfect substitutes (U = T + B), that is, he would exchange one commute by bus for one commute by T. The price of a bus ticket is $1.50 and the price of a T ticket is $2.00. Jim has $6.00 to spend on commuting. Grap..
What is the probability that the mean height for the sample is greater than 64 inches? Assume o=2.84
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