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Suppose the production function for high-quality Brandy is given by: q=K^1/2L^1/2, where q is the output of brandy per week and L is labor hours per week. In the short run, K is fixed at 100, so th
The canadian demand for the US dollar is downward sloping and the supply of the US dollar to Canadians is upward sloping. Assuming a system of flexible exchange rates between the US and Canada, grap
Suppose all tax collections are fixed (instead of dependent on income) and all spendigand transfer programs are fixed (in the sense that they do not depend n th state of the economy, as, for exampl
Which country has the absolute advantage in each good? Indicate each country's comparative advantage In what range will the world trading price ratio lie when these countries open up to free trade?
Economic issues are often discussed in the terms of money and prices, but it is difficult to quantify social capital in such terms. Can you think of topics, both within the category of social capita
How is elasticity related to revenue? how is diminishing marginal returns related to cost? how are revenues and costs related to profit?
Suppose that the price of ale rises to $2.50 per unit and remains there. Write an equation for Percy's inverse demand for cakes. i. Use red ink to draw in Percy's new inverse demand curve for cakes.
Calculate the output and price of dry cleaning if it is produced under competitive conditions without regulation. Determine the socially efficient dry cleaning.
Suppose both firms have entered the industry. What is the joint profit-maximizing level of output? How much will each firm produce? How would your answer change if the firms have not yet entered the
What are the main determinants of economic development? How economic growth can be measure?
Which of the following statements about the price/earnings ratio is false?
Suppose that a competitive firm has a total cost function C(q) = 450 + 15q + 2q^2 and a marginal cost function MC(q) = 15 + 4q. If the market price is P = $115 per unit, find the level of output pr
Calculate the velocity of money when nominal gross domestic product (GDP) is $1 trillion and the money supply is $250 billion.
The demand for labor by an industry is given by the curve L = 1200 - 10w, where L is the labor demanded per day and w is the wage rate. The supply curve is given by L = 20w. What is the equilibrium
Compare the correlation between China's rate of economic growth between 1980 and say 2005 (or 2006) and improvement in its rate of infant mortality (or another social indicator)
Which of the following is not held constant when constructing a supply curve for good X?
Suppose that when 100 units of output are produced, the MC of the 101st unit is $2. This is equal to the minimum average total cost, and MC is rising. If the optimal output level is 150 units (in th
'When elephants fight, it is the grass that suffers.'" Please comment fully on the following question: How is U.S. labor law premised on this belief?
The production function is Y = 10N. Households utility function is ln(c)+ 2ln(l). Denote the wage rate by w and assume total time endowment of household is 1. Find the firm's labor demand and supply
Write an expression for the firm's profits as a function of ticket price and expenditure on players. Find the ticket price that maximizes revenue.
Suppose that droughts in Californa substantially reduce food production in the U.S. Use th aggregate demand-aggregate supply model to illustrate graphically the short-run and the long-run impact of
Suppose you want to infer expected future exchange rates in a less-developed country that has free-market-determined interest rates but does not have a forward exchange market. Is there any other w
List five variables (and the direction of their change) that would shift the saving curve to the left. List three variables (and the direction of their change) that would shift the investment curve
Which of the following is NOT an assumption of marginal utility theory?