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Suppose there are two identical factories on a river. Both require clean water for their production processes. The upstream firm gets clean water from the river and dumps dirty water into the river. The downstream firm must clean the water it gets from the river before it can use the water and later it dumps dirty water into the river. In this situation
A) the private costs of the two firms are the same since both dump dirty water into the river.
B) the upstream factory's private costs are lower than its social costs since it passes the costs of the dirty water on to the downstream firm. For the downstream firms, private costs equal social costs.
C) the private costs of the downstream firm are greater than the private costs of the upstream firm and the social costs are less than the private costs for both firms.
D) the private costs of the upstream firm are less than its social costs while the social costs of the downstream firm are less than its private costs.
You decide to open a retirement account at your local bank that pays 8%/year/month (8% per year compounded monthly). For the next 20 years you will deposit $400 per month into the account, with all deposits and withdrawals occurring at the end of the..
Suppose you are about to complete a bachelor’s degree in your chosen major and are considering investing in a law degree. Explain the data you would need and the methods of analysis you would use in order to conduct a human capital analysis of this p..
What is the monetary certainty equivalent for the following gamble: gain $130 with probability 0.4, lose $320 with probability 0.6.
Complete Blue Catering Service Inc.’s (BCS) 2013 Form 1120, Schedule D, and Schedule G (i? applicable) using the information provided below.
Substitution and income effects of a change in price of a good may be used to explain the:
Jenny's utility function is: U = √X (square route of x). She is faced with a lottery where she has a 50 percent chance of winning $121 and a 50 percent chance of winning $225. What is the expected value of the lottery? What is Jenny's expected utilit..
If the price of laser eye surgery falls by 50 percent and the quantity of contact lenses demanded falls by 25 percent, find the cross elasticity of demand for these two goods.
Evaluate Gatorade’s decision to launch the new G Series product line and the challenge this represents to the company from an integrated marketing communications perspective.
Suppose that the market demand for medical care is summarized by the demand function: Qd = 500 – 4p and the market supply is summarized by the inverse supply function: P = 25 (i.e., horizontal supply curve at price of 25). Calculate the equilibrium q..
Assume the market for a commodity is described by the demand and supply functions. Determine the equilibrium price and quantity in this market. Draw a graph to illustrate your answer and compute the consumer surplus and the producer surplus.
The price elasticity of demand for a firm's product is equal to -1.8. The firm currently sells 4,000 units per day at a price of $2. If the firm increases its product price by 10%, then it can expect to sell approximately
You are a producer of calculators. In the market for calculators, two events happened simultaneously last month. There was a fire at your calculator factory that eliminated half of your firm's production capability. At the same time, your compens..
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