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1. What is price elasticity of demand? How is it measured? If the price elasticity is -3 and $300 is the marginal cost of product X, what should be the optimal sale price? (Hint: apply the mark-up rule)
2. What is meant by price discrimination? What are the conditions to make price discrimination effective? Discuss answers with examples from the Airline Industry.
the amount of education the typical person receives varies substantially among countries. suppose you were to compare a
Is it possible for the gross federal debt to rise in dollar terms but decline as a percentage of GDP? Explain your answer.
effects of implicit variables on supply and demand. Elucidate what would happen to the price of a pair of jeans if the following happened.
explain whether the following scenarios shift the aggregate supply or aggregate demand curves. Illustrate what happens by using a graph. Finally, state in what direction the price level and the quantity move. a.) Households decide to save a l..
A firm can seek any combination of quality and price it chooses. Thus, it can go with a low quality-low price strategy or use one which combines high quality with a high price. Ideally, of course a high quality and a LOW price will be the most pow..
Assume that the low-calorie frozen, microwavable food company from Assignments 1 and 2 wants to expand and has to make some long-term capital budgeting decisions. The company is currently facing increases in the costs of major ingredients.
How monetary policy affects aggregate supply and demand and inflation, explain exactly how a change in the federal funds rate can trigger all these reactions. Use at least 4 graphs. Do you think we are in a liquidity trap today? Why or why not?
Imagine there are two polluters of a given substance with the following marginal-abatement cost functions MAC1=200-e(1) and MAC2=300-3e(2) where emissions are measured in tons/year and both MAC1 and MAC2 are measure in $/ton. Draw on a graph MAC1...
This assignment is a reflective paper based on the discussion of the text material on irrational choices and the three common mistakes that people make. Do you make rational or irrational decisions? Consider some of your spending decisions and giv..
It is well documented that carbon monoxide emissions from combustible engines increase in colder climates. This implies that associated damages are expected to become less severe in summer months than in winter.
Explain why should a government be concerned with the pricing of products that a company transfers.
Output of lawn-care services, measured in number of lawns, depends on the hours of lawn maintenance labor, given a fixed capital stock, according to the production function: Q= 2(L^1/2). MPL is therefore 1/(L^1/2).
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