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Suppose a consumer's level of satisfaction is given by AB2 and he/she has a total of $10 to spend on goods A and B. If the price of A is $1 and the price of B is $2, and assuming you can only purchase whole units (not fractional) of A and B, how many units of A and B should he/she purchase?
Suppose that a firm has only one variable input, labor, and firm output is zero when labor is zero. When the firm hires 6 workers the firm produces 90 units of output. Fixed costs of production are $6 and the variable cost per unit of labor is $10. T..
Distinguish between comparative advantage and competitive advantage (may take some research on your part). Which is used by economists as a justification for international trade? Why?
Suppose the spot price of the euro is currently $1.47 and the 1-year forward price is $1.56. Is the 1-year interest rate higher in the U.S. or in the euro zone? (HINT: remember that Sf/d = 1/Sd/f and Ff/d = 1/Fd/f )
If taxes were cut by 1 trillion adn the mpc was .8 how much would total spending. Increase in the first year with two spending cycles? Increase over an infinite time perios?
Before output has had time to adjust, by how much is disposable income reduced. Compute the resulting change in consumption expenditure.
Are innovative product and service offerings ethically neutral? Consider Napster and the intellectual property issues associated with swapping music over the Internet as an example to begin the discussion.
The market demand is P=100-1.5Q and marginal & average costs are constant at 10 (MC=AC=10) find the monopoly price and quantity. find the perfect competition price and quantity. calculate profit, social welfare(consumer and producer surpluses), and d..
CER defaults on its loan payments to Bank One. Can Bank One attach the 100 stereo systems CER bought from Stereo Manufacturer.
Compare and contrast two events motivated by incentives, one where the self-interested behavior was good for society and the other where it was bad.
What price-output combination would exist with efficient pricing (MC = P)? Draw a graph with MC, Demand curve and MR curves for the problem above.
Greener Grass Company (GGC) competes with its main rival, Better Lawns and Gardens (BLG), in the supply and installation of in-ground lawn watering systems in the wealthy western suburbs of a major east-coast city. Derive algebraically the quantities..
Calculate the breakeven value at the low price of the data item that you consider most likely to be unreliable.
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