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A law is passed allowing shops to limit refunds on returned items to 50 percent of the original price. Discuss how shops might adjust their prices in response to this.
Suppose that a store will sell 2000 boxes of bananas a week at a price of $12 per box. If the store raises its prices to $15 per box, it will sell 1500 boxes. What is the elasticity using the original formula? What is the elasticity using the midpoin..
If a monopoly faces an inverse demand curve of p = 90 - Q, has a constant marginal and average cost of 30, and can perfectly price discriminate, what is its profit? What are the consumer surplus, welfare, and deadweight loss? How would these results ..
XYZ Co. manufactures bicycles. Demand for this year’s model is expected to occur at a constant annual rate of 7200 items. One bicycle costs $245. The holding cost is based on a 11% annual rate, and production setup costs are $340. Use the production ..
Assume the following data for the economy in the United States: Inflation is at 4.5% and has been rising for the last 3 years from a low of 1.2% Unemployment is at 4.8% and has been falling for the last 6 years from a high of 7.8% Which tool(s) would..
Queen Elizabeth has decided to auction off the crown jewels, and there are two bidders: Sultan Hassanal Bolkian of Brunei and Sheikh Zayed Al Nahyan of Abu Dhabi. The auction format is as follows: The Sultan and the Sheikh simultaneously submit a wri..
Based on what we have learned so far regarding the macro-equilibrium and fiscal policy, critically discuss the claim by some economists (like Paul Krugman) who have suggested that austerity measures have amplified the economic slump in Europe (Greece..
If an individual activity doesn't affect interstate commerce, but the aggregate of that activity does, federal commerce jurisdiction exist under the:
Find an article in a major newspaper that attempts to analyze statistical data. Summarize it , and relate what you understand about the interpretation. Do you agree with the analysis as presented in the article?
Assume only two countries, China and the US. If China decides to stimulate growth through a policy of running a large export trade surplus, does China’s national savings increase? Show the relationship between China’s national savings, domestic inves..
Governmental Budgeting Process Using a local, state, or federal government agency’s budget: Analyze how and where revenues are derived for the agency. Analyze which revenues are used in which funds: governmental, proprietary, and fiduciary.
Classical economists believe that the best monetary policy is:
The Apple company issues a coupon bond with the face value $1000, the coupon rate 7% and the maturity 10 years. If the interest rate is assumed to be fixed at 8%, what is the present value of the bond? Instead, people expect that the interest rate wi..
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