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Several countries that have experienced hyperinflation adopt dollarization as a way to control domestic inflation. For example, Ecuador has used the U.S. dollar as its domestic currency since 2000. What does dollarization imply about the exchange rate between Ecuador and the United States? Why might countries experiencing hyperinflation adopt dollarization? Why might they do this rather than just fixing their exchange rate?
Consider the simple linear regression model without an intercept, y = ß1x + u, with the assumption E(u|x)=0. Also assume that E(x)=0 Show that E(y)=0 and using this as well as E(x)=0 show that the covariance between x and y is given by E(xy) and t..
Illustrate your answer by assuming that with advertising, a firm's demand curve has price elasticity of -1.5 and without advertising, it is -2. If MC is $10, what is the difference in the profit-maximizing price.
An individual wishes to deposit an amount of money now and $100 every six months so that at the end of five years $1,500 will have been accumulated. With interest at 4% per year, compounded semiannually, how much should be deposited now
Test the null hypothesis that the population variance is equal to 93 against the alternative that the population variance is greater than 93. Use alpha = 0.05. A random sample of 100 with a mean of 60 and a standard deviation.
Maria can read 20 pages of economics in an hour. She can also read 50 pages of sociology in an hour. She spends 5 hours per day studying. a.) Draw Maria's production possibilities frontier for reading economics and sociology.
Find v^n where v is taken from our normal actuarial notation and v>0
Two car manufacturers, Saab and Volvo, have fixed costs of $1 billion and marginal costs of $10,000 per car. If Saab produces 50,000 cars per year and Volvo produces 200,000, calculate the average production cost for each company.
Assume now that the coin is tossed until we obtain a tail that is immediately preceded by a head. Find the PMF and the expected value of the number of tosses.
a refresher on how to calculate a riskier investment, when Company A has expected returns of $50,000 and standard diviation of $40,000. Company B has expected returns of $250,000 and standard deviation of $125,000.
Instead of a lump-sum payout, this policy aims to make the firms more efficient. The proposed policy uses the 10 units to fund investments in productivity. Therefore the firm does not recieve a lump sum transfer. Rather, the firm now has a 5% incr..
european governments tend to make greater use of price controls than does the u.s. government. for example the french
Suppose that over a range of prices, the price elasticity of demand varies from 15.0 to 2.5. Over another range of prices, the price elasticity of demand variesfrom 1.5 to 0.75. What can you say about total revenue
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