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Explain why P=MC in the short-run equilibrium of the perfectly competitive firm, whereas in the long-run equilibrium P=MC=AC.
Explain why anti-trust legislation supports a perfectly competitive market. Give at least one specific example of legislation to justify your explanation.
I. Consider the following static optimization problem. Suppose that a consumer has financial wealth W and owns the house H¯ . She has utility over housing H and nonhousing co
Which is better meausute of welfare?
Suppose arm's demand curve is given by P = 120? Find the (value of) price elasticity of demand (point elasticity) for the demand curve when the price is $100. Is demand elastic or
Question 3 (44 marks) Please note that this question requires substantial research. A summary from the text book is not sufficient. To score well you will have to consult several a
What are the effects of the fiscal stimulus on the macroeconomy
The data is posted on Blackboard. Download the data lfs4.dta on your personal computer. This data is from the Labour Force Survey 2003. In STATA, add enough memory to open the data
explain the terms abnormal profits and normal profits
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
Including different interest rates with different maturities would complicate the models however it wouldn't buy you very much. Because interest rates with different maturities are
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