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Suppose price levels were falling 10% per day. How would this affect the demand for money? How would it affect velocity? What can you conclude about the role of velocity during periods of rapid price change?
During the fiscal expansion associated with the Vietnam war, what type of expenditures was initially "crowded out?"
Consider a firm using labor and capital as its only inputs. The price of capital is $40 where the price of labor (wage) is $60. Using 500 units of labor and 500 units of capital the firm is producing 1200 units of output. At this mix of input the fir..
A tax imposed on the supplier of Blu Ray players shifts
Consider current on-demand digital media delivery trends, such as Apple TV, Netflix, and Hulu. Choose one company. Based on the material covered this week in the lectures and textbook, do you believe that this company has a viable revenue model? Why ..
Trevor consumes two goods: fruit (good x) and vegetables (good y). His demand for fruit is given by x(px,m)=.04m-4.24px. His income is $322, the price of fruit is $2, the price of vegetables is $1. If the price of vegetables rises to $3, calculate to..
Setting up nurse practitioner clinics to serve 20,000 newborns in Georgia would cost $6 million. This program would increase life expectancy at birth from 75.1 years to 75.3 years. How many life years would be gained? What is the cost per life year? ..
A internet company has a fixed cost of $1,750,000 per month and a variable cost of $25 per month per subscriber. The company charges $45.95 per month to its internet customers. The company currently has 75,000 subscribers and proposes to raise its mo..
Jane lives in a dormitory that offers soft drinks and chips for sale in vending machines. Her marginal utility for soft drinks (Good X) is equal to 3Yand her marginal utility of chips (Good Y) is equal to 3X. MUx = 3Y MUY = 3X Soft drinks are priced ..
If the government were to increase taxes on gasoline, what will happen to the total government revenue? Why? What are you assuming about the elasticity of the demand curve of gasoline? What is the formula for elasticity?
How might freeing up dead capital have helped to increase Mongolia’s rate of economic growth? What type of investment would foreign residents undertake if they were to purchase a small fraction of the shares of stocks owned by Mongolia’s residents?
A competitive firm uses two variable factors to produce its output, with the production function y = min{x1/2, x2}. The price of factor 1 is $4 and the price of factor 2 is $5. Due to a lack of warehouse space, the company cannot use more than 20 uni..
Explain the pros and cons of using a change in the tax rate to achieve the desired increase in output. Be sure to thoroughly elucidate how the change will affect equilibrium prices, output, and unemployment.
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