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After some consultants point out that the Acme Toy Company has two bottlenecks in its production of xylophones and yo-yos. The first is a critical grinding machine that only has 9 hours of capacity per day. The second is warehouse space which is limited to 10 (thousand) square feet. Each production run of xylophones requires 3 hours of grinding and take up two thousand square feet of storage while each yo-yo run requires one hour of grinding time and takes up 2000 square feet of storage. Each run of xylophones contributes $4 (thousand) to overhead and profit while each run of yo-yos contributes $2 (thousand).
Examine the efficiency of quanttitative credit control instrument
Example of Introducing the Government- ACCOUNTING SYSTEM So far there was no government in any of our stylized economies. Let us now introduce it. To begin with, our governmen
Suppose the Bank of Canada announces that it will raise the money supply in the future but does not change the money supply today. Using the Fisher equation, explain what happens t
You are the manager of a firm that receives revenues of $40,000 per year from product X and $90,000 per year from product Y. The own price elasticity of demand for product X is -1.
Explain why we cannot measure the national product simply by adding up the production of all firms. Why do the economists use real GDP rather than nominal GDP to gauge economic
PRODUCTION POSSIBILITY CURVE As we have seen, the essence of economic analysis is the problem of scarcity and choice. We know that limited productive resources compel individua
A negative outflow to the U.S. balance of payments is generated by the purchase of United States assets (such as United States Treasury bonds) by foreign investors and the sale of
A firm's current profits are $1,300,000. These profits are expected to grow indefinitely at a constant annual rate of 3 percent. If the firm's opportunity cost of funds is 6 percen
WHAT IT MEAN
ACCOUNTING SYSTEM-EXAMPLE IV Now consider the economy as in example III. In the next year same outputs were produced and the same incomes were paid out. However, the household
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