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In an article about the financial problems of USAToday,News week reported that the paper was losing about $20 million a year. A Wall Street analyst said that the paper should raise its price from 50 cents to 75 cents, which he estimated would bring in an additional $65 million a year. The paper's publisher rejected the idea, saying that circulation could drop sharply after a price increase, citing The Wall Street Journal's experience after it increased its price to 75 cents. What implicit assumptions are the publisher and the analyst making about price elasticity?
Money is generally considered to have three economic functions: A medium of exchange. This is its most significant role. Without money we would live in a barter economy wher
How do you calculate variable unit costs and total annual costs? Ans) Annual units sold, 1000. Raw materials yearly cost 650. Building rent yearly cost 9000. If sales volume enh
Q. What is Investment demand? Investment demand Investment I(r) is assumed to be negatively related to the real interest rate r Total dema
Relationship between the interest rate and the bond price Note that the higher the issue price, the lower the interest rate. Similarly when the price of a government bond incr
Examine the pros and cons of commercial transactions in blood from the egoistic, the utilitarian, and the Kantian perspectives.
Commercial Banks: Balance Sheet The accompaning table gives the balance sheet of a commercial bank in a simplified format. The balance sheet contains particulars of a Bank's cu
State the Price level and time We are rarely interested in the value of price level at a specific point in time. What we are interested in is percentage change in the price lev
An owner can lease her building for $100,000 per year for the next three years. The explicit cost of maintaining the building is $35,000, and the implicit cost is $50,000. All reve
Suppose you have the following information about a closed economy: C = 50 + 0.80 (Y-T) I = 200 G = 100 a) Find out the equilibrium level of income. b) Suppose G in
definition and charactoristics of index numbers.problems while constructing index numbers
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