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1. How does the marginal social benefit curve of a common resource compare to the marginal social benefit curve of positive externality from a mixed good? Highlight the differences through graphs.
2. a. Suppose the demand for saline solution is perfectly inelastic for contact lens wearers. If the government imposes a tax on saline solution, what occurs? Be sure to tell what happens to the price paid by the buyers and discuss the incidence of the tax.
b. If income tax rates on labor income are decreased, what is the effect on the labor supply and the labor supply curve? What is the effect on the equilibrium quantity of labor hired?
The total demand consists of: 1. New owner demand and 2.A replacement demand The replacement demand tends to grow with the in the total stock with the consumers. Once a pe
how does the prices system affect a country
Explain how the price system eliminates a surplus. The meaning of surplus is that quantity demanded is less as compared to the quantity supplied. This will lead to downward pr
what is the basis of marginal utility
National Income Determination: National Income Determination deals with what determines the size of a nation’s national income. The size of a nation’s national income is deter
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Slope of an Iso-quant: Since along an iso-quant the level of output remains the same, if θL units of θL are substituted for K units of K, the increase in output due to θ L
herberler theory of opportunity cost
Intermediate Products: Products (which includes both services and goods) that aren't produced in order to be consumed, but somewhat are produced in order to be used in the producti
Privatisation of the Economy: Privatisation has to be viewed in two ways: In a narrow sense, it implies the induction of private ownership in a public sector undertaking. In a
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