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A newspaper reports that in the last 5 years, prices have increased a total of 50%. This is equivalent to what annual inflation rate, compounded annually?
An Onyx Corporation design also manufactures a broad range of fluid handling also industrial products.
In the small town of Springfield, Duffman observes that the price of beer has fallen. Duffman concludes that the total amount of money spent buying beer has to fall since the price of beer is lower.
Several questions in this problem set are based on the 8/19/12 Wall Street Journal article "Cartel Pushes Up Price of Rubber." This article is at the end of the module on Antitrust Policy. There are no good substitutes and economies of scale are larg..
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..
What is the conceptual difference between a choice based on the maximization of a single objective versus a choice based on maximization with two or more objectives. Illustrate the difference by making up a specific example where a decision maker ..
can increase the natural rate of unemployment. Is this something that policymakers should be concerned with? Explain.
Consider a homocentric city where the cost of commuting is $20 per mile per month. A household located 5 miles from the city center lives in a 1,000 square foot house that costs it $500 per month. Non-land costs per house are $100 per month and there..
Analyse the effects of the following events using the loanable fund market diagram where we have (real) interest rate on the vertical axis and the quantity.
What is the relationship between price and marginal utility?
Suppose that the firm’s production function is given by Q = 10KL1/3. The firm’s capital is fixed at K. What amount of labor will the firm hire to solve its short-run cost-minimization problem?
Suppose you are given the following Total Product Function: ,where Q=100K ^ 3/2 L ^ 4/2 M ^ 4/7 is total output or units produces; K, capital; L, labor; and M, materials.; that is, this is a input factor production function. Find the Average products..
What is the output of each firm if they collude to produce the monopoly output? What profit does each firm earn with such collusion.
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