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In the text, we suggested that for well-off individuals with uniform taxation, preferences for education were not single-peaked. Why might preferences for local parks and urban public transportation systems (e.g., buses and subways) also not be single-peaked?
Why do consumers want to save more in the weak economy? What influences our consumption? Should governments be made by law to balance their budgets, or should they be permitted to run deficits sometimes? Should you go into debt sometimes? Explain?
what is the formula for that equation? Assume you have 5 uneven payments to make and you want to know what you will be paying at 10% per payment (year) on this uneven payment.
Policymakers should have a detailed knowledge and profound understanding of all theoretical models and should design economic policy based on that knowledge.
Suppose that initially the economy is in a long-run equilibrium with no money growth, no inflation, and πe = 0%. Then, the central bank announces that, starting in the next period (t+1), the money supply will begin growing at 10%/period. What happens..
Read Chris Tilly, “Shaking the Invisible Hand” (Real World Micro, article 1.2). What is the “Invisible Hand” theory? What are the political implications? List some of the assumptions made by economists who believe in the “invisible hand” and oppose g..
In the microeconomics in context model, the sectors of economic activity include:
Assume that the demand for surfboards in a given town is P = 100-4Q and the supply for surfboards in that same town is given by P = Q. What is the equilibrium price and quantity of surfboards sold in this town? Now assume that the EPA has found that ..
Suppose a risk-neutral power plant needs 10,000 tons of coal for its operations next month. It is uncertain about the future price of coal. today it sells for $60 a ton but next month it could be $50 or $70 (with equal probability). How much would th..
The first national bank received 3,000 inquiries following the latest advertisement decribing its 30-month IRA accounts in the Boston World, a local newspaper. The most recent as in similar advertising campaign in Massachusetts Business, a regional b..
When a TV company chooses a pay-per-view scheme to pay for programming, which of the following is true, false or uncertain? Explain carefully in each case. Most of the marks will be awarded for the clarity of your explanation.
Where does the national unemployment rate stand relative to the Natural Rate of Unemployment
Assume the technology for producing personal computers improves, and, at the same time, individuals discover new uses for personal computers so that there is a greater utilization of personal computers. Which if the following will happen to the equil..
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