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Suppose that at age 22, you have just finished college and have been offered a job with a starting salary of $40,000. Your salary will remain constant in real terms. However, you have also been admitted to a professional school. The school can be completed in two years. Upon graduation, you expect your starting salary to be 10% higher in real terms and to remain constant in real terms thereafter. The tax rate on labor income is 40%.
a. If the real interest rate is zero and you expect to retire at age 60 (i.e., if you do not go to professional school, you expect to work for 38 years total), what is the maximum you should be willing to pay in tuition to attend this professional school?
b. What is your answer to part (a) if you expect to pay 30% in taxes?
Oye and Maxwell's terminology is this an example of a "Stiglerian" or an "01- sonian" regulatory situation? Carefully explain your reasoning.
alternative r has a first cost of 100000 annual mampo costs of 50000 and a 20000 salvage value after 5 years.
is stability in the general level of prices through time important? why or why not? should price stability be the goal
jordan is a college student who receives a stipend of 1000 a month. he uses the stipend to pay rent for housing and to
Determine why, given the advantages of international diversification, some firms choose not to expand internationally. Provide specific examples to support your response. As firms attempt to internationalize, they may be tempted to locate their fa..
How does the market-oriented tradition associated with Adam Smith differ from the active government tradition advocated by Alexander Hamilton?
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The owner-manager of Good Guys Enterprises obtains utility from income (profit) and from having the firm behave in a socially conscious manner, such as making charitable contributions or civic expenditures. Can you set up the problem and derive th..
Price fixing is a per se violation of Clayton Antitrust Act. From the materials in library and the Internet, find out an example of the price fixing case or other violations of U.S. antitrust law.
Consider a monopolistically competitive firm with N firms. Each firms business opportunities are described by the following equations: Demand: Q = (100/N)-P Marginal revenue: MR = (100/N)-2Q Total cost: TC = 150+Q2 Marginal cost: MC = 2Q
sometimes market activities production buying and selling have unintended positive or negative effects outside the
governments have several means available to guide and influence competition in the marketplace. these means include
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