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Suppose you are the production manager for Widgets, Inc. Your job is to produce a fixed amount of output at the lowest cost possible. When you take over the position, you find that the price paid for a unit of labor is $20 (W = $20), and the price paid for a unit of capital is $50 (R = $50). You also discover that with the current mix of capital (K) and labor (L), the marginal product of labor is 10 (MPL = 10) and the marginal product of capital is 20 (MPK = 20). Is your company minimizing cost? If not, how could you change inputs to do so? Use a diagram to help explain your answer.
benefit of GDP
Equilibrium in the money market In the IS-LM-model, we have equilibrium in the money market when MD(Y, R) = MS This is the equation
show on the market for cheese that impact of what happened in the milk market.
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
Relationship between the interest rate and the bond price Note that the higher the issue price, the lower the interest rate. In the same way, when the price of a government bon
Consumer Equilibrium: According to our assumption for 'x' units consumption of the commodity, gross utility obtained by the consumer is U(x).But for this, the consumer must sp
If the indifference curves are straight lines with slope s, and the budget constraint is given by: x*p1+y*p2 = m, then describe the optimal choice of the consumer.
why is international trade important for south Africa
(A) What is the difference between a movement along a demand or supply curve and a shift of one of these curves? Why is it important to distinguish between the two? What mistake
how can a central bank diminish inflation
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