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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?
Derive the conditions for steady state in the Solow model. What are its implications? In what respects is the golden rule different from the steady state?
A bakery has fixed costs of $10 per day and variable costs of $1 per loaf. Its oven can handle up to 50 loaves a day and it is impossible to obtain additional capacity. Sketch the
explain the terms abnormal profits and normal profits
The greater the number of different goods available in an economy, Question 1 options: a) the less likely it is that a double coincidence of wants will exist, and the less likel
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Consider the following utility function: U = X 1 X 2 Where X 1 and X 2 are quantities consumed of two goods. You are considering the actions of a consumer that maxi
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FDI Inflows - An Appraisal: A comparison of the magnitude of FDI inflows received by India would appear too small, especially when compared to the inflows received by other co
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