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1. Consider two projects. The first project pays benefits of $90 today and nothing else. The second project pays nothing today, nothing one year from now, but $100 two years from now. Which project would be preferred if the discount rate were 0%? What if the rate increased to 10%? 2. Suppose that the original before-tax demand curve is P = 98-2Qd and that supply is P = 2+2Qs. Now suppose a $3 unit tax is imposed on consumers.a. Use supply and demand diagrams to show the effect of a $3-unit tax imposed on the demand side. b. What is the before-tax equilibrium price and quantity?c. What is the after-tax equilibrium quantity?d. Calculate the economic incidence incurred by producers and the economic incidence incurred by consumers.e. How much tax revenue is raised?
effects of real wage existing in the market that is lower than the equlibrium real wage.what will happen in this labour market if it is perfectly competitive
what is microeconomics
During the 1990s, technological advance reduced the cost of computer chips. Explain, with the use supply and demand diagrams, how the following markets are affected in terms of pri
A passive deficit is the portion of the deficit that exists when: A. inflation is not fully anticipated. B. inflation is fully anticipated. C. the economy is at potential income. D
Firms in the circular flow We divide all firms into 3 categories: F R comprises all firms which acquire raw material (farm products, iron ore and so on), F H all those that p
Unemployment rate (LUNEMP): A key variable to assess the performance of any economy when an economy is growing, the unemployment rate will fall as job creation increases and in
The estimated statistics from the VAR model are not able to be interpreted to solve the problem of this coursework due to reasons that are discussed in the next subchapter. Therefo
Give a brief description of the transmission mechanism 1. When the central bank target rate increases, other interest rates in the economy will increase (and the money supply
1 (a) List two concerns with inflation. (b) Suppose that we are in a condition of fully flexible prices, but production of nails will not go above 200 chairs/month. What price w
An experiment is explained by an exponential random variable with mean ? and x1 and x2. A proposed test of the hypothesis ?=2 next to the alternative ?=½ uses the critical region {
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