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In the final round of a TV game show, contestants have a chance to increase their current winnings of 1 million dollars to 10 million dollars. If they are wrong, their prize is decreased to $100,000.
A copy company wants to expand production. It currently has 20 workers who share eight copiers. Two months ago, the firm added two copiers, and output increased by 100,000 pages
Suppose a consumer's income is used on two goods, X and Y. The consumer's income is $200 and the prices of X AND y are $10 and $5 respectively.
Michelle (a calendar year individual) begins a new business as a sole proprietorship. She would like to use an October 31 fiscal year end for her business because the calendar year ends during her bus
The university has built a new parking garage. There is always an available parking spot, but it costs $1 per day. Before the new garage was built, it usually took 15 minutes of cruising to find a par
An owner can lease her building for $120,000 per year for three years. The explicit cost of maintaining the building is $40,000, and the implicit cost is $55,000. All revenues are received
Why does a prospective monopolistic competitor find it relatively easy to start production in the long run?
What are some of the natural and artificial barriers to entry into oligopolistic industries?
Why do firms demand resources? In what way is a firm’s demand for a resource a derived demand? How does this differ from consumers’ demand for final commodities?
Define marginal revenue. How is it calculated? Why is marginal revenue constant and equal to price under perfect competition?
Should the government break up a monopoly into a large number of perfectly competitive firms? Why?
What is the relationship of the cost of producing output and the money receipts of businesses when there are only consumer expenditures? What should happen to the level of output?
Find the change in the equilibrium level of output when there is a $10 increase in net export spending and the MPC =0.50, 0.75, and 0.80.
Consider a monocentric city with commuting costs of $40 per mile.A household 8 miles from the city center occupies a dwelling with 1000 square feet at a monthly rental rate of $600
A bridge over the Coosa River currently has no tolls and an average passage of 880 cars per day. State government wants to place a toll on the bridge with the objective of raising the most revenue
How much quantity does each individual firm produce? Using your answers from a) and b), determine if an individual firm is making a profit or loss and calculate this amount.
Consider a market with four firms.Suppose the first firm has a49% market share,the second has a 35%market share, the third firm has a 10% market share, and the fourth firm has a 6% market share
At a meeting with the manager, the accountant suggested raising the price of the hamburgers to $4.00 to improve the profit margin (P – AC). The manager noted that this would lead to a decline in
A price change causes the quantity demanded of a good to decrease by 30 percent, while the total revenue of that good increases by 15 percent. Is the demand curve elastic or inelastic?
Suppose the demand for gizmos is given by the following expression: P=20-5QD +4 I (Income) In this expresiion, P is the price gizmo, quantity is given in millions of units, and I is income.
What would be the long run price and quantity for this firm in a competitive market? 2. In the long run how many firms are in the industry?
A monopolist firm faces the following cost curve: C(Q) = 10Q + 300, where Q is the output produced. The demand for its product is given by P = 50 - .
Consider the following Ricardian model. Consider the following Ricardian model.
1) Name a good with a negative externality. What is the external cost? Will a free market for this good provide too much or too little to be allocatively? how can the government ensure an optimal
One of the reasons Joseph SchumPeter argued that capital was doomed was