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Studies indicate that the price elasticity of demand for cigarettes is about .4. If a pack of cigarettes currently costs $2, and the government wants to reduce smoking by 20 percent, by how much should it increase its price?
An electric company must decide whether to install a scrubber to reduce sulfur dioxide emissions from its electric generating station. The plant currently has no such pollution control equipment, and must buy SO2 permits to cover its emissions at ..
Explain how does a subsidy to consumers differ from a subsidy to producers in correcting for a positive externality.
Suppose the price of unleaded regular octane gasoline were 20 cents per gallon higher in New jersey than in Oklahoma. Do you think there would be an opportunity for arbitrage (i.e that the firms could buy gas in Oklahoma and then sell it at a profit ..
Suppose further that people want to hold 8 percent of their deposits in the form of cash. Then, if the Fed wants the money supply to be $6,228 billion, what is the necessary level of high-powered money?
Kermit is considering purchasing a new computer system. The purchase price is $100,000. Kermit will borrow one-fourth of the purchase price from a bank at 10 percent per year compounded annually. The loan is to be repaid using equal annual payment..
you are a member of the metropolitan taxi commission which sets taxi fares for your city. you have been told that long
Long-run real interest rates are expected to increase. An accountant and an MBA student (who just finished his course ofManagerial Economics) where interviewed regarding the effect on the firm they both work at
Explain the various terms in the AS curve. Elucidate why the price of oil enters negatively. Solve for the equilibrium value of real GDP and the price level.
For many firms, production takes place in two or more different plants whose operating costs can differ. In this question you will be asked to set up a multiple plant monopolist optimization model and economically interpret the marginal condition
For each hour of work, the employer deducts $1 and sends the money to the city government. The initial wage (Before the tax) is $10, and total employment is 20,000 hours per day. Use a graph to show the effect of the tax on the equilibrium wage an..
Short term Treasury bills [3 and 6 month] have current annual rates of interest around 0.5%. Use that info plus your best forecast of inflation to calculate the real rate of interest on those bills.
Illustrate what would you like to see done by the Federal government which would be of help to your organization
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