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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?
1.the AD curve represents at the same time the demand for goods, money and labor in the economy 2.in the AS-AD model, higher competition among producers leads to a medium run equil
(A) What is the difference between a movement along a demand or supply curve and a shift of one of these curves? Why is it important to distinguish between the two? What mistake
Given the following: Airbus Boeing Demand P = 182.868 - 0.0003Q P = 198.6592 - 0.00013Q TVC Curve TVC = 104.8822Q - 0.001Q^2 + 0.09Q^3 TVC = 25.8678Q - 0.00023Q^2 + 0.4Q^3 In
Illustrate about the Effective exchange rate Assume that we are interested in external competitiveness of a country, say Japan. To do this we could look at evolution of a speci
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mundell-Fleming Model
Suppose A can somehow change the game in problem 5.1 to a new one in which his payoff from Up is reduced by 2, producing the following payoff matrix. a. Find the Nash equilibriu
define business cycle
How is economics works with interaction of individual choices? Principles behind the interaction of individual choices: 1. There are gains through trade. • Specialization
1. You are managing a breakfast and lunch only restaurant that sells all-inclusive plated meals (i.e. all lunches include any protein or hot foods as well as salads and sides on a
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