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The auto industry often rolls out incentives in order to try to generate new sales. For example, Ford introduced the most dramatic consumer incentive program in the company's long history - the Ford Drive America Program. That program provided consumers with either cash back or zero percent financing for new Ford vehicles. Assume you were an owner of a Ford/Lincoln/Mercury franchise, how would you expect this program to impact your firm's bottom line? Explain?
Suppose the price of coffee beans increases by $0.20 per pound. What is the effect of this raw material price increase on the demand for roasted coffee? If one pound produces 50 cups of coffee, would the price of a cup of coffee rise by $0.01? Explai..
Compare the efficiency of monopolistic and perfectly competitive markets. Discuss the economic factors that lead to the development of monopolies. Examples of monopolies include electric utilities, railroads, airlines, cable television, and sports le..
Why, in a model with no production but two periods does an increase in current taxes (without a concurrent change in government spending) not affect consumption? Explain graphically how such a change effects savings. How would the model likely change..
In the _____, households receive goods and services and pay firms for them
Consider the Heckscher-Ohlin theory and the Stolper-Samuelson theorem. What do they suggest about who the gainers and the losers are from International trade?
There is a hamburger stand located in Providence, RI, which is a perfectly competitive market for hamburgers. If the hamburger stand produces hamburgers, they will sell 300 hamburgers in one day. Should they exit the market in the long-run? If there ..
Amalgamated Popcorn, Inc. is a fairly small firm selling bags of flavored gourmet popcorn in a popular mall. As shop owner and operator, you have observed that your daily sales tend to follow a pattern that can be stated as: Compute the elasticity co..
There are two main categories of food - conventional and organic ingredients - and four food groups. The data are shown in the following table.
Suppose that only data on in action were published but not on claims for unemployment. What would be a reaction of the USD/EUR in that case.
A firm in a purely competitive industry has a typical cost structure. The normal rate of profit in the economy is 6 percent. This firm is earning $15 on every $150 invested by its founders. What is its percentage rate of return? percent. Is the firm ..
What do economists call the difference between how much a consumer is willing and able to pay for a good or service and the dollar amount that he or she actually pays for it?
An industrial machine costing $14,000 will produce net cash savings of $5,000 per year. The machine has a five-year useful life but must be returned to the factory for major repairs after three years of operation. These repairs cost $5,000. The compa..
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