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An agent has a utility function over goods 1 and 2 of the form U = xc1 x d2 where c is your 1- digit number and d is your minimum number. The agent's income is equal to your 2-digit number. Initially, the price of good 1 is your median number and the price of good 2 is your individual number. Let the price of good 1 change to your maximum number. For good 1, determine for this price change the
a) Total price effect
b) The substitution effect
c) The income effect
A sample of 60 mutual funds was taken and the mean return in the sample was 13% with a standard deviation of 6.9%. The return on a particular index of stocks (against which the mut
What are the disadvantages of informal economy? Disadvantages of the informal sector are as illustrated below: • don’t pay direct taxes; • Can produce important pollutio
Suppose a monopolist produces at constant marginal cost and is able to discriminate between two groups of consumers. The demand in each group is linear. Would the monopolist discri
(present value) Suppose an entrepreneur considers to invest in a project. It needs a cash investment $I at year t = 0. If she/he invests, the project will generate an annual cash
Why do all multinational automakers choose to use FDI to enter this industry? What are the drawbacks of using other entry modes such as exporting and licensing?
How is supply related to opportunity cost?
QUESTION (a) Explain and discuss the Structure Conduct Performance framework (b) The hypotheses of interest in the Structure Conduct Performance framework are as follows- H
What are the critics of advocates of World Bank in promotion of development? Critics of the World Bank argue: • A one-size-fits all strategy which does not take account
state the demand theory.
Situation: Only a few astute operatives say the crash in real estate prices as the USA entered the summer of 2007. You were one of the few that appreciated that real estate price
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