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Consider an economy like the one above, except that the wages paid in the high-wage industry fall as the number of workers in that industry rises. In particular, assume that each worker's wage income is
where p is again the fraction of workers in that industry. The wage income of low-wage workers continues to be fixed at $4. Find all of the pairs (yH , yL) that can occur in this economy.
What is the number of voters at which voting no longer becomes worthwhile?
Answer the questions in part a assuming the reserve ratio is 20 percent. Explain the resulting difference in the lending ability of the commercial banking system.
Assume that demand for a commodity is represented by the equation P = 10 - 0.2 Q d, and supply by the equation P = 2 + 0.2 Qs where Qd and Q s are quantity demanded and quantity supplied, respectively, and P is the Price. Use the equilibrium condi..
Consider the following sets of investment projects, each of which has a three-year investment life: Period Project Cash Flow n A B C D 0 -5,000 -2,000 4,500 -3,500 1 5,800 -4,400 -6,000 1,000 2 12,400 7,000 2,000 5,0003 8,200 3,000 4,000 6,000
What do your results in the last question imply about the relationship between the number of police and the crime rate? Are you confident in these results based on the work you have done? Why or why not
What is the likely effect on the equilibrium rate of interest? Will the equilibrium amount of borrowing rise or will it fall?
A corporate bond has a face value of $10,000 with a bond rate of 6%. The interest of the bond will be paid quarterly. The bond will mature in 10 years. If the bond is sold at $7,000 on the market, what is the yield (return) on the bond
Check that these LMC curves intersect with the LAC curves appropriately.
A grocery store notices that the cross-price elasticity between ice cream and chocolate syrup is -.3. The store is advertising a sale with ice cream prices reduced by 20%. By how much should they expect chocolate syrup sales to increase
Where Qx is the quantity demanded of Product X, Px is the price of X, Y is income, and r is the prime interest rate (given in decimals, e.g., 0.02 or 0.05) The standard error of each estimated coefficient is given in parentheses below it. Also, th..
a company desires to estimate the cost of building a 600-mw fossil-fuel plant for the assembly of its new long-distance
The European Engine Corporation is a multi-national producer of small gasoline and diesel motors. European Engine Corporation has estimated the following cost experience for a new 3.5 hp engine over a sample of 122 observations,
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