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Question: A firm in a perfectly competitive market invents a new method of production that lowers its marginal costs. What happens to its output? What happens to the price it charges?
a. The firm has an employee who threatens to tell all other firms in the industry about how to implement this new technique. Will it be possible to bribe the employee not to do this? Explain why or why not.
b. Why should this employee probably choose to tell only some of the other firms rather than all of them?
c. What factors will determine the best number of firms to sell the secret to? (Assume that those who get the information keep the secret instead of selling it to still others.)
as monetary policymakers care more about inflation stabilization the slope of the aggregate demand curve becomes
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Evaluate the Clean Air Act and determine if it has been effective from an economic standpoint. Explain your reasoning. Based on your evaluation of the Clean Air Act and additional efforts to address pollution, make policy recommendations that woul..
Assume that Carl and Wanda each make $40,000. Each was given a raise of $4,000. Carl's spending increased from $40,000 to $43,000. Wanda's savings increased from $1,000 to $2,000.
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At the beginning of this year, daily consumption of gasoline in the US amounted to 344 million gallons. It is estimated that for every 10% increase in the price of gasoline, the demand for gasoline reduces by 2.00%.
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A large electric utility company has proposed building an $820 million combined cycle, gas-powered plant to replace the electric generation capacity at one of its coal-fired facilities. Develop three other alternatives for replacing this electric gen..
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