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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?
Potatoes cost Janice $1 per pound, and she has $5.00 that she could possibly spend on potatoes or other items. If she feels that the first pound of potatoes is worth $1.50, the sec
Economic functions of money - A medium of exchange This is its most important role. Without money we would live in a barter economy where we would have to trade goods and
Using a short-run Phillips Curve, illustrate the change in inflation and unemployment resulting from the increase in profit expectations.
1) Why does the adoption of Keynesian economics come out of the Great Depression? 1) Why does the adoption of Keynesian economics come out of the Great Depression? 2) What will ha
what is money multiplier? what is role , importance, advantages , disadvantages , limitations and examples of money multiplier?
explain the profit maximizing/loss minimizing rule may be applied under the 3 scenarios
if your earning records over year has been:Yt=$40000 Yt-1=$38000 Yt-2=34000 Yt-3=$32000 YT-4=31000,What is the your permanet income?
Determine the GDP price index for 1984, using 2005 as the base year
(a) Use this information to set up a diagram showing the firm''s total revenue and total cost schedules. In this diagram, show the points at which the firm is maximizing profits.
Stocks and Flows When studying economics, one must be sure whether the variable being studied is a stock variable or a flow variable. Failure to do so can cause faulty economi
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