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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?
Describe the differences between the substitution effect of a wage increase and the income effect of a wage increase.
Determine about the interest rates The interest rate may be fixed or floating. If it is fixed, you will pay the same percentage for the entire duration of the loan. With a floa
What are the indicators of development? Economic development is a complicated multi-dimensional idea. Preferably each aspect of development needs its own indicator. • Prof
what role does interst rate play in refernce to output?
factors affecting national income
Lucas’ point of view, what are the limitations of the Keynesian model? What improvements does he suggest?
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
market structurs
Marginal Propensity to save (MPS) is the ratio of change in total saving to change in total disposable income. Symbolically, MPS = ?S/?Y For example, total
THE AD CURVE SHIFT TO THE LEFT WHEN
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