Is the company allocating resources efficiently

Assignment Help International Economics
Reference no: EM13236708

Upscale hotels in the United States recently cut their prices by 20 percent in an effort to bolster dwindling occupancy rates among business travelers. A survey performed by a major research organization indicated that businesses are wary of current economic conditions and are now restoring to electronic media, such as the Internet and the telephone, to transact business. Assume a company's budget permits it to spend $5,000 per month on either business travel or electronic media to transact business. Graphically illustrate how a 20 percent decline in the price of business travel would impact this company's budget set if the price of business travel was initially $1,000 per trip and the price of electronic media was $500 per hour. Suppose that, after the price of business travel drops, the company issues a report indicating that its marginal rate of substitution between electronic media and business travel is -1. Is the company allocating resources efficiently?

Reference no: EM13236708

Questions Cloud

Define the balloon ascends to an altitude : The balloon ascends to an altitude of 20 , where the pressure is 76.0 and the temperature is 50. . What is the new volume, , of the balloon in liters, assuming it doesn't break or leak
What is the change in clean springs profit-maximizing levels : Suppose the Clean Springs Water Company has a monopoly on bottled water sales in California. If the price of tap water increases, what is the change in Clean Springs profit-maximizing levels of output, price, and profit
Determine what is the new price and qauntity of gass : Consider the market for gasoline. In the initial equilibrium, the price is $2.00 per gallon and the quantity is 100 million gallons. The price elasticity of demand is 0.70, and the price elasticity of supply is 1.0.
Define ammonia can be made by reacting calcium cyanamide : Ammonia can be made by reacting calcium cyanamide (CaCN2) with water as shown: CaCN2 + 3 H2O => CaCO3 + 2 NH3. How many grams of calcium cyanamide are required to react with 417.8 g of water
Is the company allocating resources efficiently : A survey performed by a major research organization indicated that businesses are wary of current economic conditions and are now restoring to electronic media, such as the Internet and the telephone, to transact business.
Compute the coefficient of variation of the number : What is the standard deviation of the number of service calls and compute the coefficient of variation of the number of service calls.
Explain how many grams of water are required to react : Ammonia can be made by reacting calcium cyanamide (CaCN2) with water as shown: CaCN2 + 3 H2O => CaCO3 + 2 NH3. How many grams of water are required to react with 212.9 g of calcium cyanamide
What is the frequency of the oscillator : A 2.00-m-long rope has a mass of 0.100 kg, What is the frequency of the oscillator if the power transmitted is 120 W
Explain how many grams of alcl3 will be made : Consider the reaction, 2 Al(s) + 3 Cl2(g) => 2 AlCl3(g). How many grams of AlCl3 will be made by the reaction of 7 moles of Al(s) with 27 moles of Cl2(g)

Reviews

Write a Review

International Economics Questions & Answers

  Explain the federal income tax code for the united states

Suppose that preferences over private consumption C and public goods G are such that these two goods are perfect substitutes, that is, the marginal rate of substitution of public goods for private goods is a constant b>0. Determine the optimal qua..

  How large is the initial spending injection

WASHINGTON-Less than one month after President Obama took office, Congress last night passed his flagship proposal, an unprecedented collection of tax cuts and new spending that Democrats say offers the country its best hope to stave off an impend..

  Which face capital inflows nd which to face capital outflows

Suppose that the U.S. dollar-pound sterling spot exchange rate equals $1.60/£, while the expected future rate is $1.64/£. The yield on a one-year U.S. Treasury bill is 9% and on a one-year U.K. Treasury bill the yield is 8%.

  Describe the long-term productivity in the united states

Terrorist attacks foster instability and may affect productivity over the short and long term. Do you think the September 11, 2001, terrorist attacks on the World Trade Center and the Pentagon affected short- and/or long-term productivity in the U..

  Extensions and issues

Exam: 050476RR - EXTENSIONS AND ISSUES; INTERNATIONAL ECONOMICS - The very poorest low-income developing countries typically have relatively and which one of the following groups of economists is most likely to favor annually balanced federal budgets..

  Discuss the effects of the price floor on conditions

The U.S. government imposes a price floor for U.S. sugar that isabove the market clearing price. Illustrate the U.S. sugarmarket with the price floor in place. Discuss the effects of the price floor on conditions in the market for sugar in the Uni..

  Discussion on federalism

The U.S. at the end of World War II stood as the world preeminent superpower, with new discovered political and economic wealth. To what degree, if any, has U.S. ascendancy on world stage affected notions of federalism?

  Increasing social security taxes

Assume that the government wishes to rise Social Security taxes by $1 per hour of work and is undecided between rising the tax on employees and rising the tax on workers.

  Why the supply of applicants for dock jobs is great

Labor unions face many challenges-including changing technology, foreign competition, and declining membership. But one union occupation thrives-dockworkers. The 100,000 members of the two longshoremen unions handle nearly every item or shipping c..

  What types of depository institutions are found in the us

(Depository Institutions) What is a depository institution, and what types of depository institutions are found in the United States How do they act as intermediaries between savers and borrowers Why do they play this role

  Why we should go back to the gold standard

The United States and most other countries abandoned the gold standard during the 1930s. Why would the 1930s have been a particularly difficult time for countries to remain on the gold standard Do you agree or disagree with Congressman Ron Paul ..

  How much to purchase capital nd labour in competitive market

A firm purchases capital and labour in competitive markets at prices of r=$6/machine-hour and w=$4/labour-hour,respectively. With the firm's current input mix, the marginal product of capital is 12kg/machine-hour and the margi..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd