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Matchstick corporation competes in a competitive market where output price is $2.00. The production function for Matchstick is Q = 9 K2/3 L1/3 where K is capital and L is labor. In the short run, Matchstick is using 8 units of capital. If Matchstick is employing 27 units of labor, then what wage is Matchstick paying its workers if the firm is maximizing profit?
The international organization that replaced the General Agreement on Tariffs and Trade (GATT) is the
"When in Rome, do as the Romans do". Would this be a suitable guideline for MNC's (multinational corporations) doing business in developing countries with respect to ethical practices and social responsibility? Discuss.
What is rent seeking behavior? How does it explain why government has grown in recent years and how it explain why it is difficult to change tax or spending policies in the United States?
A firm produces both crayons and pencils in constant proportions (1/3 and 2/3 respectively). Its costs are C(q1;q2)=1000+10q1+5q2+9q1q2, where q1 is the output of crayons and q2 the output of pencils. Calculate its minimum efficient scale (MES) of pr..
What are pros and cons of having a fixed exchange rate and floating exchange rate? Please provide the complete solution of this problem.
The economy of country Rumblen was hit by a banking crisis which led to a recession. Jason Wallace, a real estate agent, says that the economy will recover soon because the government is taking various measures to counter the recession. Some banks in..
a. In April 2011, the unemployment rate in the United States increased from 8.8% to 9%. This means the economy is not yet recovering from the Great Recession.
The Duckett Group is trying to determine its optimal average cash balance. The firm has determined that it will need $8,100,000 net new cash during the coming year. According to the Baumol model, what should be Duckett’s average cash balance?
In the specific factors model predict who seeks protection against trade and who does not. Explain your answer. How does your answer change in the Hecksher-Ohlin model? Explain
Discuss which model that best describes the historical economic development in The Bahamas. Which approach would you recommend to best ensure sustainable development in The Bahamas?
How does the Financial Accelerator influence both aggregate demand and supply? How is Bernanke & Gertler’s analysis pro-cyclical?Consider the following functions: Qd = -4P + 190 and Qs = P - 10. Further assume that the government has institutes a pri..
The Federal Reserve’s target rate for the federal funds rate
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