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Problem: Assume that capital share is 30%. GDP in country A grew at the rate of 3% per year. Capital grew at the rate of 5% per year and labor 1% per year. What is the implied growth rate of TFP.
Sketch graph a standard short-run production function, and identify on it the points where the average product peaks, the marginal product peaks, and the marginal product reaches zero, and the average and marginal product intersect.
Supply side theorists claimed all of the following justifications for their theory, except:
a. What is the equilibrium price of coffee? a. How many cups of coffee will be exchanged at this price?
What lag in discretionary policy is described in each of the following statements? Why do long lags make discretionary policy less effective?
Suppose that demand for a product is given by Q=1000-P. Supply of the product is given by Q=2P. There is a positive consumption externality from this product, in the amount of $5 per unit. What quantity of the good is consumed under the private marke..
The state of California has a pollution permit market for carbon emissions, where all large firms must have a permit for each ton of carbon emissions they generate. The California state government sets the supply of permits and large electricity prod..
You are the marketing or pricing director for a large firm. By spending $8.5 million in research and development, your firm has developed a product for treating
A commercial bank has checkable-deposit liabilities of $75,000 and a reserve ratio of 15 percent. What is the amount of required reserves?
Many goods and services are illegally sold or legally sold but not reported to the government. How would increased efforts to count those goods and services affect our calculation of GDP?
A firm's production function is qi = 2Li + 10Ki. Assume both variables can be adjusted, even in the short run (for instance, making an item by hand versus using a machine to do so). What is the firm's cost function. Now suppose the output price is $8..
Suppose Paula consumes both 87 and 89 octane gasoline. Assume that before the recent price increases, Paula paid $3.00/gallon for 87 octane and $3.10/gallon for 89 octane. The price of each grade of gasoline has now risen by exactly 65 cents. Make th..
a. Explain briefly why this strategy may make sense. b. What is your total loss without this strategy?
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