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Julia can fix a meal in 1 hour, and her opportunity cost of one hour is $50. Jacque can fix the same kind of meal in 2 hours, and his opportunity cost of one hour is $20. Will both Julia and Jacque be better off if she pays him $45 per meal to fix her meals? Explain.
The machine will save $50,000 in labor annually. The machine can be purchased today for $200,00 and will be used for 10 years. It has a salvage value of $10,000 at the end of its useful life. The new machine will require an annual maintenance cost..
Ymir Larson farms near Niffleheim, Minnesota. He works 80 hours a week. He can either grow rutabagas or raise pigs. Every hour that he spends growing rutabagas gives him $2 of income this year. Every hour that he spends raising pigs this year will..
Notice that the models have different service lives. However, model A will be available in the future with the same cash flows. Model B is available at 1 time only. If you select model B now, you will have to replace it wil model A at the end of y..
Suppose that college students in your tow persuaded the town council to enact a law settings the maximum price for rental housing at $400 per month. Will this help or hurt college students who rent housing In your answer, address how this price ce..
At a product price of $ 40, how many units will this firm produce in the short-run b)At a product price of $ 50, how many units will this firm produce in the short-run c) At a product price of $ 60, how many units will this firm produce in the short..
There is a single difference: we've changed the exponent on At in the production function of the output good so that there is now a diminishing marginal product to ideas in that sector. 1. Provide an economic interpretation for each equation.
Suppose that an investor has a choice between buying this security or purchasing a different security that also costs $3,000 today but pays off $3,300 with certainty in one year. How is an investor's choice of which security to purchase related to..
a. Jack consumes two goods: food and leisure. He works for 8 hours per day and earns a wage of $8 dollars per hour. His rich uncles also give him around $20 per day. Illustrate Jack's choice of work and leisure using an indifference curve and a b..
Some people have the opportunity to invest in stocks in a tax-advantaged retirement plan, such as a 401(k) plan. Consider the difference between Andy, who is able to save in a tax-advantaged plan, and Ben, who must pay taxes on his return each yea..
The following table is the pay off matrix for zero sum game. Estimate the each players dominated strategy of the following zero sum game?
A company will need $65,000 in 5 years for a new addition. To meet this goal, the deposits money in an account today that pays 7% annual interest compounded quarterly. Find the amount that should be invested to total &65,000 in 5 years.
The price of a stock is uniformly distributed between $30 and $40. a. What is the probability that the stock price will be more than $37 b. What is the probability that the stock price will be less than or equal to $32 c. What is the probability that..
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