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Consider the following market game: there are two firms in an industry firm1 and firm 2. Firm 1 first chooses the quantity of its production and then firm 2 observing q1 will choose q2.
Here are the cost functions for these firms: C1(q1) = 10q1 + 100
C2(q2) = 5q2 + 150
Demand curve is given by P=1000-Q where Q is the total quantity produced in the market. What would be the output of each of these firms? Which firm will produce more? Why?
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A provider charges $200 for an office visit. The insurer's allowed fee is 80% of charges. The beneficiaries pay 20% of the allowed fee. In this case, how much would the insurer pay? How much would the patient need to cover?
In Japan during the first half of 2000, the Bank of Japan kept interest rates at a near zero level in an attempt to stimulate demand. In addition, the government passed a substantial increase in government expenditure and cut taxes. Slowly, Japanese ..
Forecasting models can be divided into three groups
It can be really hard to engage this kind of thinking because it requires risks that aren't even known or knowable, but it's these very risks that reap the biggest rewards. So, as a leader how might you evaluate an option like this? What would it tak..
For each of the following, predict the effects on the equilibrium levels of aggregate output (Y) and the interest rate (r). Be sure you make predictions for both Y and r! During 2000, the Federal Reserve was tightening monetary policy in an attempt t..
Suppose a unit of quota rights allows the producer to sell a unit of output each year indefinitely into the future. Illustrate what increase in consumer prices will occur.
Suppose that two consumers care only about the goods that they own. (The goods are private for them.) Starting from a competitive equilibrium allocation, is it possible for both consumers to be made simultaneously better off by trading with each othe..
"The Assistant Secretary for Time Travel recommends that the bureau choose the socially optimal price, the price necessary for efficient allocation of resources. Which price is required for efficient allocation of resources.
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