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Giving reasons state whether the following statements are true or false:
a. Elasticity of supply is equal to one only if supply curve forms an angle of 45 degrees at the origin.
b. With increase in level of output, average fixed cost goes on falling till it reaches zero.
c. Under diminishing returns to a factor, total product continues to increase till marginal product reaches zero.
You are the director of a Washington, D.C., think tank focusing on tax and economic policy issues. You were recently (and informally) contacted by staff of the Congressional Joint Committee on Taxation to weigh in on a number of issues currently unde..
Consider two workers with identical preferences. Phil and Bill. Both workers have the same life cycle wage path in that they face the same wage at every age, and they know what their future wages will be. Leisure and consumption are both normal goods..
Assume the demand function for good X is Qd = 600 - 2PX + 7PR, illustrate what is the demand function for good x. Which investment produces a $40 daily profit for a game shop earning $2 profit from every game sold.
Suppose that a monopolist sells a product to consumers with an aggregate demand that is downward sloping in quantity, D(Q) = 200 − 2Q. The total cost of producing Q units is C(Q) = 20Q + 2Q2. What are the consumer and producer surpluses (CS and PS) a..
Explain your intuition as to why premia rise between April and September. Which of options above has lowest time value.
q1. y fk l a k0.4l1.0a calculate the marginal product of labor mplb does this production function exhibit diminishing
Suppose that a leading computer software firm holds the copyright to a statistical software package. It wished to hire an expert statistician to develop a new module that it will then market as an independent add-on to the basic package. What is the..
Understand why depositing cash on a checking account does not affect money supply immediately. Understand why when a commercial bank buys government securities from its clients, new money is being created? Understand why when Fed buys government secu..
Three men claim to be the fastest gun in the West. To see who is right, they agree to meet at a desolate location in a desert. On a circular, cobblestoned area that is roughly 50 yards in diameter, each stands at the perimeter such that each man is e..
Which advertising scenario is likely to provide the least amount of economic usefulness?
An electricity industry contains two generating firms, one of which has marginal cost= $2.50 and the other of $1.50; the demand curve is Quantity=40-4*price. Quantities are in MWH and price are in $/Mwh. Very low production cost! Find cournot Equilib..
Consider a monetary policy rule that has the following parameter values: r ¯ = 2%, m ¯ = 1/2, and π ¯ = 2%. (a) Obtain data on the inflation rate for the most recent 12-month period possible (you should briefly document how and where you obtained the..
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