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A firm can produce steel with or without a filter on its smokestack. If it produces without a filter, the external costs on the community are $500,000 per year. If it produces with a filter, there are no external costs on the community, and the firm will incur an annual fixed cost of $300,000 for the filter. a) Use the Coase Theorem to explain how costless bargaining will lead to a socially efficient outcome, regardless of whether the property rights are owned by the community or the producer.b) How would your answer to part (a) change if the extra yearly fixed cost of the filter were $600,000?
When given two demand functions to calculate elasticity of demand do you use point elasticity or arc elasticity of demand formula
real GDP is increasingly criticized for its alleged failure to adequately measure the standard of living. To what extent do you think this criticism is valid?
THE STRUCTURE OF POPULATION AND SUPPLY OF LABOUR The structure (also called age distribution or composition) of population, or the number of people in the different age groups
what is the importance of demand forecasting to managers
definition of total revenue,marginal revenue,average revenue
Problem: Long-Run Labor Demand and Factor Substitutability Suppose there are two inputs in the production function, labor (L) and capital (K), which can be combined to produce
Economics has two major branches: (1) micro economics, and (2) both micro and macro economics theories. The parts of micro and macro economics that constitute managerial economics
Traditional theoretical concepts to actual business behaviour Accommodating traditional theoretical concepts to actual business behaviour and conditions: Managerial economic
Q. Explain about Managerial Economies? Large scale production makes possible the division of managerial functions. So there exists a production manager, a finance manager, asal
Q. Illustrate Internal Economies of Scale? Internal economies of scale are the benefits of large scale production. They are enjoyed by the firm when it increases its scale of p
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