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Suppose that Congress is considering imposing a 30% tariff on imported automobiles. Who would be the gainers and who would be the losers from such a move?
What is the profit-maximizing price-output combination and what are the levels of the profits and consumer surplus at that point? What is Dead-weight-loss?
The airline has an average of 40 passengers paying an average of $200 for this flight. Do you think the airline should be flying between the two cities? Evaluate from a short-run and long-run perspective.
Suppose that the governmental authorities wished to decrease use of a pesticide that is leaching into groundwater supplies in a watershed by 60% from current use levels.
Suppose the CFO of a German corporation with surplus cash flow has 1 million Euros to invest. Suppose that interest rates on 1-year CD deposits in U.S. banks
Describe the law of diminishing returns. Then discuss why you agree or disagree with following statements.
Explain why user cost, or scarcity rent, arises in the intertemporal allocation of a depletable resource such as minerals, and some types of energy and aquifer water resources.
A tariff is simply a tax on imports. Use our model of the excise tax (with diagram) to describe why domestic firms request that tariffs be imposed.
Describe unemployment and the unemployment rate. Might we be able to say "Job Stats: Too Good to be True?"
Discuss how each of the following developments would affect the supply of the money, the demand for money, and the interest rate. For each case, describe what happens in closed economy and in small open economy. Describe your answers with diagrams.
Agree or disagree and describe: In monopolistically competitive market, firms that innovate successfully can increase their economic profits and lock in higher market shares over long run.
When the Bank of Canada sells the government bonds to a commercial bank, the commercial bank experiences a decline in reserves and in increase in bonds. Total assets are unchanged; this is just a portfolio switch between bonds and cash.
What is the opportunity cost of going to a doctor to be examined for skin cancer? Would eliminating research reduce or increase the cost of U.S. health care?
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