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As a result of the multiplier effect, small changes in investment spending can create much larger changes in total output. Given the current level of high unemployment in Canada what the government can do to encourage investors to invest more? Should the Government do some of the following and do you think these will be effective? Can you think of additional measures?
If the par value of the common stock is 5 dollars and is sold at market for 10 dollars does the company get the extra $5? Also how is the company affected by the market value going up and down?
Microsoft and smaller rival often have to select from one of two competing technologies. The rival always prefers to select the same technology as Microsoft (because compatibility is important), while Microsoft always want to select a different techn..
If producing a good generates pollution (a negative externality), from a social perspective ...
Economists often disagree about the proper role of government in the economy, but they almost all agree that the government should:
A monopoly is considering selling several units of a homogeneous product as a single package. A typical consumer’s demand for the product is Qd = 120 - 0.5P, and the marginal cost of production is $150. Determine the optimal number of units to put in..
What is meant by marginal analysis, and how is this related to the objective of efficiency for a society’s allocative choice.
Suppose that Omar’s marginal utility for cups of coffee is constant at 2.5 utils per cup no matter how many cups he drinks. How big would that budget have to be before he would spend a dollar buying a first cup of coffee?
Illustrate what effect does the income tax have on consumption and labor supply? Explain your results in terms of income and substitution effects thoroughly.
Perry is a freshman. He estimates that the cost of tuition, books, room and board, transportation, and other incidentals will be $13,000 this year. He expects these to rise about $1500 each year while he is in college. If it will take him 5 years to ..
Yasmine’s income this period is $500 and she is certain that her income next period is $300. The current market interest rate is 10 percent. She plans to spend exactly her current income this period and her future income next period, with no borrowin..
Derive, from first principles, the equilibrium level of income. Derive the Keynesian expenditure multiplier. If T = tY, derive the equilibrium level of income.
The production function is given by f(x)=4x^1/2. If the price of a commodity produced is $60 per unit and the cost of the input is $20 per unit, how much profit will the firm make if it maximizes profit?
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