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Suppose that a city mayor proposes to pay for the acquisition and construction of public parks by implementing a 7-year local sales tax. Someone argues that the financing mechanism should instead be something that is spread out over more time, noting that a person who moves here 8 years from now would get to enjoy the parks but under the current proposal wouldn't pay for them. Similarly, this individual argues that those who live in the community now pay for it, but if they move, they won't benefit at all from it after a few years. The mayor argues that those who move out of this area will in fact benefit from the parks beyond their personal use and that those who move to this area after the 7-year period will implicitly pay for the access to the parks. What does the mayor mean?
During the energy crisis of the 1970s, and again in the last 5 years, Congress bemoaned the “price gouging” and “windfall” profits of the major oil companies. In the 1970s Congress imposed an “excess profits tax” on these companies. If “excess profi..
Imagine that you were the president of an emerging country that is trying to reduce the number of its imports
The Newport Beach Sanitary Agency is presently shipping its waste to another municipality at an annual cost of $100,000. It is considering building a landfill near the city. Start-up costs for the landfill are $900,000, and there are closing costs of..
The Financial Advisor is a weekly column in the local newspaper. "I need a new car that I will keep for 5 years. I have three options. I can (A) pay $19,999 now, (B) make monthly payments for a 6% 5-year loan with 0% down, or (C) make lease payments ..
A company bought three flexible manufacturing cell at a price of $400,000 each. when they were delivered, company paid freight charge of $30,000 and handling fees of $15,000. Site preparation for these cells cost $50,000. Determine the cost basis (th..
q1. why might a company use an indirect cost discrimination scheme versus direct cost discrimination?q2. starting with
Evaluate and explain as accurately as you can the manner in which each of the following individual or party would be affected by fairly rapid inflation? a) A department store assistant manager. b) A pensioner who receives fixed monthly income.
If consumers perceive several goods to be homogeneous, they believe the goods to be,
Why is depreciation of capital good a cost of society. In illustrate what ways does a person's health depreciate. Why might older people's health care expenditures increase in Grossman model even though their desired health stocks may be lower.
Consider the situation of an inverted yield curve. What does this mean? Why is it unusual? Under the theories of the term structure, why is an inverted yield curve considered bad news for the economy?
A monopoly is considering selling several units of a homogeneous product as a single package. A typical consumer’s demand for the product is Qd = 110 - 0.25P, and the marginal cost of production is $160. Determine the optimal number of units to put i..
The fact that a consumer is not required to buy the goods that a given firm produces, as well as the fact that the consumer might want the goods a firm produces, but may choose to buy from other firms instead.
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