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A firm is a purely competitive industry is currently producing 1000 units per day as a total cost of $600. If the firm produces 1200 units per day its total cost is $600. If the firm produces 1000 u
.In the long run, a price increase from $1 to $2 has an elasticity of supply of 1.50. So how many popsicles will be sold per day in the long run if the prices rises to $2 each ( Hint : Apply the mid
Suppose that this year's money supply is $500 billion, nominal GDP is $10 trillion, and real GDP is $5trillion. What is the price level and the velocity of money.
Instead of transaction B (above), assume the Federal Reserve buys $50,000 worth of securities from the bank, what is the maximum amount of money that can be created by this single transaction
The company debt represents 25%, the preferred stock represents 10%, and the common stock equity represents 65% of total capital on the basis of the market values of the three components. The compan
As a manager if a chain of movie theaters that are monopolies in their respective markets, you have noticed much higher demand on weekends than during the week. You therefore conducted a study that
According to an article in The Wall Street Journal, side-impact crashes are among the deadliest, accounting for nearly 10,000 deaths per year. Child safety concerns have kept auto manufacturers from
A local restaurateur who had been running a profitable business for many years recently purchased a three-way liquor license. This license gives the owner the legal right to sell beer, wine and spir
Consider the partial equilibrium setting in which the market inverse demand is given by p(y)=90-2y. Consider that there is a representative firm whose cost function is given by c(y)=4y^2.
Consider a firm which is characterized by cost function c(y)=y^3-6y^2+10y+32. a) Describe the firm's entry-exit decision. b) Describe the firm's operation-shutdown decision. c) Describe the firm's sup
There are two consumers, A and B. A's preferecne is represented by uA(xA1,xA2)=4ln(xA1)+3ln(xA2) and B's preference is represented by uB(xB1,xB2)=3ln(xB1)+5ln(xB2). A's initial holding is (wA1,wA2)=
Assume that marginal cost of supplying one more operating system to a computer is zero. PM=price charged. Cost of production per computer is equal to $1000 + PM. Assume that the downstream computer
Various computer manufacturers produce homogenous computers. Cost of production per computer is equal to $1000 + PM where the $1000 captures other computer component costs, such as the microprocesso
Use a computer regression package or Excel to work this computer exercise. Palm Products Company has collected data on its average variable costs of production for the past 12 months.
Suppose that the political conflicts between the U.S. and oil exporting countries caused the oil exporting countries to institute an oil embargo against the U.S. Then the U.S. government started con
U(C,1-L)=4C2/3(1-L)1/3, where C is the amount of consumption and L is the number of hours worked. If the price for consumption is $9, the wage rate per hour is $6, initially the consumer had $162 an
Currently, at a price of $1 each, 100 popsicles are sold per day in the the perpetually hot town of Rostin . Consider the elasticity of supply. In the short term run, a price increase from $1 to $2
U(C,1day-L)=4C2/3(1day-L)1/3, where C is the amount of consumption and L is the number of hours worked. If the price for consumption is $9, the wage rate per hour is $6, initially the consumer had $
Suppose that an i-phone producer produces 300 i-phones a week. Initially the price of i-phone is $200 and the demand function for i-phone is: x1=20+(m/(10*p1)), where x1 is the amount of i-phones de
The local government has given a monopoly franchise to a cable company. The graph also shows the marginal revenue (MR) curve, the marginal cost (MC) curve, and the average total cost (ATC) curve for
To develop a domestic computer industry, the government prohibits imports of computers and gives a single local firm the right to produce and sell computers. The demand curve shows the local demand
Automobiles are typically financed for four years with monthly payments made to the lending agency. Assume you will need to borrow $18 000 with 48 monthly payments at 6.5% annual interest.
To evaluate the two projects, you decide to use the company's weighted average cost of capital (WACC) for the less risky project (12 percent) and the WACC plus two points (14 percent) for the more r
a. Suppose that if the wage is raised a second time to $40 per hour, the number of cars sold rises to an average of 2.5 per day. What is now the labor cost per car sold b. If the firm's goal is to m
One unit of object is going to be sold via auction. There are two bidders, A and B. Their willingness to pay are known to be either of 10,20,30,40,50 and bids are also restricted to those values.