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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?
Neo-classical thinking on growth: Neo-classical thinking on growth is owed to the Robert Solow whose exogenous growth models in the of the mid-20th century remained
THE MODEL BUILDING A model of individual or aggregate economic phenomena represents a simplification of real world economic complexities. It may be expressed in words, ta
definition of cheap money
The Pigou effect: A) suggests that as prices fall and real money balances rise, consumers should feel less wealthy and spend less. B) suggests that as prices fall and real mo
Informal groups exist in almost every kind of organization. Answer the following questions and provide examples to support your position: • What types of informal groups do you
Now we will analyse how macroeconomic variables fit together and present models which explain the main macroeconomic variables. Using these models we can, for instance, analyse
1. Estimating Women's Labor Supply a. The following regression was run for an estimate of the current women's labor supply curve: Where h i = hours of labor suppl
One constraint in our economy is time. As a society, we make choices about the allocation of time between work and other pursuits. In the US, most workers are eligible for overtime
Over the past month, the 500 customers have downloaded the following number of songs from WalMart's website (obviously, they have had more, but we need to use workable numbers): 13
WHAT IS THE CENTRAL PROPOSITION OF THE ORTHODOX KEYNESNIANS?
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