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Rising Insurance Rates. Consider an insurance company that provides group medical coverage for university employees. The company discovered that some of its younger employees had switched to other insurance companies. The company responded to the loss of customers by increasing its price. This is puzzling because you might think the insurance company would drop its price to prevent other employees from switching to other companies.
a. What is the rationale for increasing the price?
b. If you change one word in the second sentence, it would be logical for the insurance company to decrease rather than increase its price. What is the word, and why is it decisive?
A newspaper is considering buying locked vending machines to replace open newspaper racks in the downtown area. The vending machines cost $45 each. It is expected that the annual revenue from selling the same quantity of newspapers
The weights of a population of parts made by a certain machine are normally distributed with a mean of ten pounds and a standard deviation of two pounds. What is the probability that a part of drawn at random from the machine weighs between 8 and..
Suppose Zia spends her time picking berries and apples. Her production set is described by the equation , where is the number of berries and y the number of apples.
Point A 4m barrels oil 200 tonnes lumber Point B 6m barrels oil 150 tonnes lumber a) If we had a PPF with the goods oil and lumber, how would be measure the MC of oil between points A and B
Suppose that Sam considers starting with all of his land in corn. Then he thinks about increasing the amount of wheat that he grows. What is the opportunity cost, in bushels of corn, of the first bushel of wheat that he grows
the government wants to adopt a fiscal stimulus, but is worried about raising the budget deficit, so, it decided to raise expenditure and taxes by $200 each, what will happen to equilibrium GDP? Creat a new multiplier model graph and show separate..
The City of New York has 200 advertising companies, 199 of which employ designers of normal ability at a salary of $100,000 a year. Paying this salary, each of the 199 firms makes a normal profit on $500,000 in revenue.
Let a linear demand function be expressed as Q = a + bP, where b
1 the labor-leisure trade-offsheila must decide how to allocate her 24-hour day between non-wage
Discuss how new discoveries in genetics are contributing to our understanding of the HIV virus & how some folks exposed to HIV have been able to escape developing AIDS.
suppose that the employer concession SCHEDULE IS W=1+0.02S and the union resistance curve is W=5+0.02s-0.01S2, where=percentge wage increase and S=expected strike length in days, Using Hick's simplest model, determine the length of the strike and ..
calculate the size of the labor force, the labor force participation rate, and the unemployment rate by using population:100,000 Employed:60,000 Unemployed:3,000
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