Start Discovering Solved Questions and Your Course Assignments
TextBooks Included
Active Tutors
Asked Questions
Answered Questions
If you are a manufacturer do you necessarily want the gray market to cease to exist? Why or why not? How about if you are a franchised dealer?
Because the franchisee pays a percentage of sales in most franchise agreements, do you conclude that existing agreements are inefficient?
If VMP is downward-sloping, marginal cost must slope upward. Explain why verbally, and then try it mathematically.
How does your analysis of VMP change if the employer is a monopolist producer of its output but a price-taker in the labor market?
Explain why unskilled U.S. citizens will view their arrival with alarm but relatively skilled ones will either favor it or show little concern.
What happens to the employment decision if an employer is a price-taker in the market for its output but faces an upward-sloping supply curve of labor.
Use present-value arguments to show why you should usually invest in general human capital in your early years.
Show that if the demand for labor is relatively elastic and the supply isrelatively inelastic then workers pay relatively more than their stated 6.2 percent.
What sorts of changes in their labor market might explain the declines in student achievement and test scores that have been observed over the past 40 years?
Payment by employers appears to be inconsistent with our reasoning about why students are more likely to pay for their general human capital.
Does that necessarily hold here? Explain. For what sorts of activities do you prefer a monopoly government? Competitive governments? Why?
When might it make sense for PepsiCo to divest its potato chip operations? For Coca-Cola to begin manufacturing snacks?
Why not choose to fully insure by hedging 100 percent of them? Jet Blue hedged almost none of them. Was Jet Blue's management necessarily incompetent?
Show that the new profitmaximizing output is 3 units, price is $9, and profit is $9. Calculate the annual consumer and producer benefits before and after.
Say an innovation then lowers every seller's marginal costs by $5 at all outputs. Find the new price, quantity, and producer and consumer surpluses.
However, buyers and sellers have transaction costs of $2 and $3 per unit, respectively. Compare the equilibrium values with those you calculated for Problem 14.
How might your answer change if beekeepers are competitive and there is only one farmer?
What sorts of provisions might a contract include to handle days when it rains and the bees cannot be released?
Can you think of any comparable beneficial externalities from college education? If they exist, is there necessarily a case for public funding of colleges?
Show that it is impossible to find a payment by the writer that induces the beekeeper and farmer to arrange for the beekeeper to stay for only three days.
What range of payments will the beekeeper accept? Assuming that the beekeeper gets that amount, what range of payments will the farmer accept?
If you were interested in efficiency, how would you decide the case? Why, if at all, would your exact decision matter?
In the example of the diamond in the cave, what would be efficient law if any one explorer had only a very small probability of finding the diamond?
Does the patent system encourage duplicative efforts solely for the chance to be first? Why might you want the patent system to do this?
Why do you expect that State A or State B will have a larger fraction of contracts imposed by government? Explain.