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The only road connecting two populated islands is currently a freeway. During rush hour, there is congestion because of the heavy traffic. The marginal external cost from congestion rises as the amount of traffic on the road increases. At the current equilibrium, the marginal external cost from congestion is $5 per vehicle. Would a toll charge of $5 per vehicle lead to an economically efficient amount of traffic? If not, would you expect the economically efficient toll to be larger than, or less than $5?
Actual income and Full employment income Full employment income (Also called Potential National) is the national income that could be produced when the country's factors of pr
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Consider a manufactured good whose production process generates pollution. The annual demand for the good is given by Qd=100-3P. The annual market supply is given by Qs=P. In both
CONCEPT AND PHASES OF TRADE CYCLE Broadly speaking, the trade or business cycles are those fluctuations which recur in economic activity with a certain degree of regularity fo
what is the theory of firm?
Define concept of Managerial decision-making Managerial decision-making draws on economic concepts as well as techniques and tools of analysis provided by decision sciences. T
Antitrust authorities at the Federal Trade Commission are reviewing your company's recent merger with a rival firm. The FTC is concerned that the merger of two rival firms in the s
Estimating economic relationships Managerial economics estimates economic relationships between various business factors likeelasticity of demand, income, profit analysis, cos
THE COMPANY WOULD TO INCREASE THE PRICE OF STEEL IT SELLS BY 6% THE MANAGEMENT FORECAST ED THAT INCOME WILL RISE BY 4% NEXT YEAR AND THAT PRICE OF ALUMINIUM WILL FALL BY 2%. IF THE
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