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Assume an economy is represented by the following: C=100+0.5Yd, T=2000, G=2000, I=200
(a) Calculate the equilibrium level of output. Graph your solution.
(b) If the government spending increases by 100 what is the new equilibrium level of output? Use the government spending multiplier.
(c) If the government increases taxes by 100 what is the new equilibrium level of output? Use the tax multiplier.
(d) If the government increases taxes and spending by 100 what is the new equilibrium level of output?
(e) Calculate the equilibrium level of output in case where taxes depend on income according to the following: T=-50+0.25Y.
(a) The payback period (b) The total equivalent investment cost at the end of the construction period
In making efficiency comparisons between a monopolized and a competitive industry, the Marginal Cost function of the monopolist
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Under which type of market structure is the firm's pricing decision the most difficult?
Annual demand and supply for the Entronics company is given by: QD = 5,000 + 0.5 M + 0.2 A - 100P, and QS = -5000 + 100P where Q is the quantity per year, P is price, M is income per household, and A is advertising expenditure. What is the value of t..
The company's profit exceeds $20 million per year, and it is purchasing $850,000 worth of capital assets this year. The company uses an interest rate of 12%.
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1. What is the optimal price and quantity sold by the firm?
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How does it relate to the concept of asymmetric information about knowing what the seller is willing to tell you about the condition of a product?
Imagine an isolated economy made up of individuals who are both consumers and sellers. The table below tracks the income and spending of a small part of this economy: 8 individuals called A through H. Naturally, the whole economy includes additional ..
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