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Suppose a country's GDP equals $500 billion for a particular year. Economists in the country estimate that household production equals 40% of GDP. a.What is the value of the country's household production for that year? b.Counting both GDP and household production, what is the country's total output for the year?
Barney Rubble, marketing director for Flintstones, is considering whether or not the company should market its product directly to end users for $300 per unit. Although no added investment in productive facilities is required, there are additional..
Suppose that you believe the fundamental value of Wal-Grey stock is about to rise from $50 to $100 because of its new management team. You have $20,000 that you can risk in the market, where the market interest rate is 6%. You can think of four po..
When wekend prices skyrocket, some weekend golfers choose to play during the week instead. The greater difference between the weekday and the weekend prices, thegreater are the number of "defectors." How might this factor affect the operator's pri..
You are an economic consultant to a city that just imposed a payroll tax of $1 per hour of work. This payroll tax is paid by workers through a payroll deduction: For each hour of work, the employer deducts $1 and sends the money to the city govern..
FULL KARMA FOR COMPLETE RESPONSES. In an infinitely repeated game between two firms, suppose that each earns a payoff of 20 if they collude on price and 20 if they compete on price. If one firm sets the collusive price and the other "cheats", the ..
Consider the Harrod-Domar model. Suppose that initially, an African country's capital-output ratio (k) is 5, and the savings rate (s) is 12%. a). What will be the initial GDP growth rate b). Suppose that technological advances cause the capital-out..
The MacBurger Company, a chain of fast food restaurants, expects to earn $200 million after taxes for the current year. The company has a policy of paying out half of its net after tax income to the holders of the company's 100 million shares of c..
you can invest in a project with returns that depend on the amount of your investment. Specifically, the formula relating next year's payoff to your investment today is C1=(-C0 -0.1)^(1/2), c1 c2 are in million dollars.
If the CPI was 110 last year and is 121 this year, what is this year's rate of inflation In contrast, suppose that the CPI was 110 last year and is 108 this year. What is this year's rate of inflation What term do economists use to describe this s..
A researcher estimated that the price elasticity of demand for automobiles in the U.S. is -1.2, while the income elasticity off demand is 3.0. Next year, U.S. automakers intend to increase the average price of automobiles by 5 percent, and they ex..
The World of Videos operates a retail store that rents move videos. For each of the last 10 years, World of Videos has consistently earned profits exceeding $25,000 per year. The store is located on prime real estate in a college town. World of Vi..
Assume that a welfare program pays $100 per week if a person does not work and reduces the welfare benefit dollar for dollar with earnings. Assume that the individuals does not have any other nonwage income.
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