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Suppose a firm's budget were large enough to employ 100 units of either labor or capital, the cost of a unit of labor being the same as a unit of capital. The production function is X = KL. Given that output must be at least 20, what is the maximum number of people the firm could employ?
Monetary policies This is the direction of the economy through the variables of money supply and the price of money. Expanding the supply of money and lowering the rate of in
Development of Transportation and Marketing Facilitates: The expansion of an industry may expedite the development of transportation and marketing facilities that will decrease th
The short run equilibrium of monopolist is displayed below in figure. Figure: Abnormal Profit under Monopoly AR is the average revenue curve, MR is marginal revenue cu
Mankiw Model of Nominal Rigidities There are two related reasons for which firms do not frequently change prices. First, as we saw in the discussion on menu costs, the cost
(i) Do the laws of economics still work today? (use the case discussed in class to answer this question or any other examples) (ii) Provide examples of three factors that can sh
determination of size of firm
Indifference Curve Analysis In the 1930s a group of economists, including Sir John Hicks and sir Roy Allen, came to believe that cardinal measurement of utility was not necess
Ajax has the following short run cost curve when tc=800000-5000Q+100Q2
Individual firm and market supply curves The quantities and prices in the supply schedule can be plotted on a graph. Such a graph is called the firm supply curve. A fir
Explain baumol''s static model
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