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Flossy has a quasi-linear utility function, 16q1^0.5 + q2. The price of good 1 is fixed at one. Thus, Flossy's budget constraint is q1 + p2q2 =Y, where Y denotes income. 6.1 Compute the interior solution. 6.2 Compute the interior solution where q1 > 0 and q2 = 0. 6.3 Under what conditions on prices and income is the corner solution obtained?
Which is a better measure of economic well-being real GDP or Nominal GDP? Ans) Well real GDP takes into account the inflation rate and therefore is more accurate at recording th
Such analysis permits the firm to determine at what level of operations it will break even (earn zero profit) and to discover the relationship among volume, costs, and profits. It
why is imports subtracted from the expenditure approach
It was observed that following a one standard deviation shock to the price of oil, interest rates rose sharply immediately afterwards reaching a maximum after two quarters. Then fr
Question 1 Discuss the relationship between microeconomics and macroeconomics Question 2 What do you understand production method? What precaution should be taken while
State the market for overnight loans Overnight interest rates are rates for loans over a single night - these are the shortest of all interest rates. During the day, banks norm
(40 points) Consider two consumers, A and B. A and B both want perfect consumption smoothing (c = cf) and both have no current wealth. However, the two consumers have different inc
The managers of Firm A recommend that Firm A purchase Firm B because the purchase will diversify the business of Firm A. Diversification of risks is a desirable strategy for indivi
#five differnces between a monopoly market and a monopolistic market
The price will change in the market, only due to the change in demand for the product. True or false
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