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Q1. Currently, there is an incumbent monopoly in a market. A potential entrant may enter. The incumbent can spend X dollars lobbying to require all new firms that enter the market to use a pollution-abatement device that costs Y dollars to install. If lobbying occurs, the pollution-abatement device will be required. Draw the game tree describing this situation. Under what conditions will the monopoly lobby?
Q2. Suppose that the supply curve of healthcare services is perfectly inelastic (i.e., vertical). Analyze the impact of an increase in consumer income on the market price and quantity of the services. Now, suppose that the demand for healthcare services isperfectly inelastic (i.e., vertical), while the supply curve is upward sloping. Analyze the impact.
One of the three ADM executives was actually an informant who tipped off the Feds about this conspiracy. Which executive was he. Why did he rat out his co-workers.
The benefit of cutting down a forest is $1 million now. the environmental cost of that harvest is $10/year forever.
Why all the balance of payments accounts be in surplus. What factors determine the demand for British pounds in foreign exchange markets.
Under oligopoly if one firm in an industry significantly increases advertising expenditures in order to capture a greater market share, it is most likely that other firms in that industry.
Explain each of the following using supply and demand diagrams, With the use of a graph, explain how these two programs affect cigarette consumption and the price of cigarettes.
Ordinary least- squares method or the two- satge least squares method for estimating industry demand for rutabagas.
Suppose the interest rate on 6-month treasury bills is 7 percent per year in the United Kingdom and 4 percent per year in the United States.
If one draws MC curves pre and post innovation as well as the Marginal Revenue line for a monopoly and the MR in a competitive situation.
Results of drilling are 15 dry holes, 12 gas producers, 18 oil wells, and 20 wells producing both oil and gas.
Describe the Schumpeterian notion of "creative destruction"
Each station's objective is to maximize its viewing audience, in order to maximize the station advertising revenue.
DHL prides itself on having its own staff of more than 300,000 people spread across the globe, instead of relying on local agents.
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