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Effects of price control
Explain the difference between a price floor and a price ceiling. Provide a situation in which a price ceiling may be used. What are the effects of this price control on the equilibrium price and quantity?
You are the manager of a firm that produces products X and Y at zero cost. You know that different types of consumers value your two products differently.
Illustrate what is the internal rate of return for the college investment that this person faces. Write out the equation used to evaluate the net benefit.
There has been some speculation that tax deductions like as the one allowed for interest on home mortgages will be eliminated or altered.
Draw a graph of the market for banana. What are the equilibrium price and quantity? Explain why. If the price of banana was $1.50 a box. What would be the situation in the banana market (shortage or surplus)? Explain why and how the price and quanti..
At the end of 2002, the (1-year) interest rate was 1% in the U.S., and 26% in Argentina. Recall that at the same time, the spot rate for the Argentine currency was Peso 4.00/$.
Assume that, from an initial consumer equilibrium position, the price of good X falls-explain how and why the consumer's relative consumption of two goods will change.
Explain when we look at the macro economy the similar terms are known as Aggregate Demand
In the 1970s people had become accustomed to high inflation. In 1979, Bank of Canada decided to fight inflation and decreased the money supply growth rates.
The law of comparative advantage recommends that countries specialize in those products in which they have a comparative advantage, not an absolute advantage.
What happens to the equilibrium price and quantity in each market? Which product experiences a larger change in quantity? Which product experiences a larger change in price?
How many "spells" of unemployment occur each year in this economy? What percentage of the "spells" are only one month long?
The annual demand for coffee by the U.S consumers is Q = 250 - 10P. Compute the lost consumer surplus?
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