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What conditions are necessary for a firm to produce as opposed to shutting down in the short-run?
a. State the condition in terms of totals (total revenue, total cost and/or its components).
b. State the condition in terms of per unit values (namely, price, average cost and/or its components).
Phelps-Dodge plans to expand capacity by purchasing equipment that will provide additional smelting capacity. The cost of the initial investment is expected to be $16 million. The company expects revenue to increase by $3.8 million per year after the..
Linda inherited a sum of $50,000 from one or her great parents. She would like to invest in one of the following three possible investment opportunities for a period of 10 years. Choose the best one for her.
If one has 3 choices to move business into another country and the following information exists, should you do so in if so which country would you choose?
Why do behavioral economists consider it helpful to base a theory of economic behavior on the actual mental processes that people use to make decisions? Why do neoclassical economists not care about whether a theory incorporates those actual mental p..
Compute new supply of $ at each exchange rate and graph the new supply curve.
The first cash flow of a 25-year series of quarterly cash flows is equal to $35,000. Each cash flow in the series increases by $800. Find the amount of each cash flow in an equal quarterly cash flow series that is equivalent to the increasing cash fl..
If the marginal product of the 4th worker hired is 6, and the marginal product of the 5th worker hired is 4, you should not hire the 5th worker because your profit would decrease since the 5th worker’s marginal product is less than the marginal produ..
Many small boats are made of fiberglass, which is derived from crude oil. Suppose that the price of oil rises. Using diagrams, show what happens to the cost curves of an individual boat-making firm and to the market supply curve. What happens to the ..
Why is wage labor completely incompatible with feudalism? Is economic life distinctly separate from social and political life in America? Describe what Smith meant by the “invisible hand.” What is the mechanism by which selfish interests are made com..
Suppose that the government increases spending from G to G1 while simultaneously raising taxes in such a way that, at the initial level of output, the budget remains balanced. Show the effect of this change on the aggregate demand schedule. How does ..
What does it mean when we say that a firm enjoys increasing returns to scale? What are some factors that contribute to a firm achieving increasing returns to scale (or economics of scale) in the long run?
Bob and Karl are deciding how to split their time between writing music and lyrics for their new album. Their PPFs for 72 hours of work are shown below. Bob and Karl have to write music for 8 songs and lyrics for 12 songs (4 songs already have music)..
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