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In 1999 Mercedes-Benz USA adopted a new pricing policy, which it called NFP (negotiation-free process), that sought to eliminate price negotiations between customers and new-car dealers. An article in The New York Times (August 29, 1999) reported that a New Jersey Mercedes dealer who had his franchise revoked is suing Mercedes, claiming that he was fired for refusing to go along with Mercedes' no-haggling pricing policy. The New Jersey dealer said he thought the NFP policy was illegal Why might Mercedes' NFP policy be illegal? Can you offer another reason why the New Jersey dealer might not have wished to follow a no-haggling policy?
After a competitive bidding process, Firm G wins a contract to collect and dispose of Firm H's hazardous waste for $1,000 per year. Firm G's labor costs are $200 per year, and beca
Determine what is the yield curve The yield curve is a graph of interest rates of different maturity (recalculated to yearly rates) at a particular point in time. It is common
Consider the economic data for Country A: Unemployment level of 15% Natural Rate of Unemployment is 6%. Required Reserves is 25% C = 50 + 0.75Y; I = 600; G = 250 (note: T = 200 for
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Tariff Reform: India's customs tariff rates have been declining since 1991. The "peak" rate came down from 150 percent in 1991-92 to 40 percent in 1997-98. The downward mom
Illustrate an example of Consumer Price Index For instance, if we spend twice as much on apples as on pears, apples would have twice the weight in basket. The precise details o
Monetarism This school argues that disturbances within the monetary sector are the principal causes of instability in the economy. According to monetarists, the money supply i
Discretionary fiscal policy will stabilize the economy most when: A.) deficits are incurred during recessions and surpluses during inflations B.) the budget is balanced each year C
Overnight target rates and inflation One of the major targets of every central bank is a low and stable inflation. Its main control variable is the overnight interest rate tar
Ask Jenny, your niece, is a smart high-school student who wants to make smart choices for her future. Hearing of your course in Business Economics, she has emailed you asking for a
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