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"The operator of the tunnel that links Britain and France, Eurotunnel, said that commercial and tourist traffic using its car and coach shuttle service had fallen sharply in 2004, leading to a drop in operating revenues of 4%. Eurotunnel's chief executive, Jean-Louis Raymond, blamed cut-throat competition from budget airlines." (News story, January 2005)
a. If Mr. Raymond is correct, are the services of airlines and Eurotunnel substitutes or complements?
b. Use demand and supply analysis to explain how lower airfares between Paris and London impact the market for the shuttle services of Eurotunnel.
Suppose that there is an "inflation scare," that is, suppose market participants increase their expectations of future inflation.
Suppose a friend you know requires a mortgage loan to purchase a house. Your friend can purchase it now or wait until later and is unsure of what to do.
A monopolist has determined that marginal revenue is $2.00 and average cost is $1.75. It has also determined that the lowest sustainable average cost is $1.75. To maximize profit, should the firm lower its price, increase its price, or leave the p..
How income may change savings behavior
In 2005, The economist reported that France's real exchange rate had increased relative to Germany's real exchange rate during the preceding two years. How can this be true if both France and Germany used the euro as their currency.
Suppose that yi receives $ 60 per day as interest on inheritance and her wage is $25 per hour, and she can work a maximum of 16 hours per day at her job. draw her daily budget constraint.
assume that the combined consumer goods + capital goods values for points a, b, and c are $20 billion, $40 billion, and $38 billion respectively. If the economy moves from point a to point b over a 14-year period, what must have been its annual ra..
Illustrate what trends are in the data sets. I need to support my assertions of trends with statistical evidence.
you will be challenged to show one or more of the criteria which you believe should be improved at your place of employment.
The Alpha Corporation is a member of the lamp industry, which is perfectly competitive. The value of a lamp is $50. The company's total cost function is:
Suppose two people, Mary and John each live in an isolated region. They each have the same resources availabe and they grow corn and raise pigs. Mary devotes all her resources to growing corn, which she raises 200 pounds of corn per year.
Provide a cost-benefit analysis for a company which has to decide whether to hire more staff or hire temporary workers to meet production schedules. Determine how managers would use your cost-benefit analysis to make this decision.
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