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Nancy is endowed with $1000 of income in period 0 and $315 in period 1. The market interest rate is 5 percent. Identify the excess burden and the tax revenue raised on your diagram and determine their
If a firm has total revenues of ten million, explicit costs of eight million and implicit costs of three million, then:
Demand for illegal drugs is inelastic. Much of expenditure on illegal drugs comes from crime. Suppose these statements to be correct, How would a successful campaign which decreases supply of drugs i
This is partly taken from a court case where one of my colleagues was a witness. Suppose that an employee is terminated without cause and that she sues the company for compensation. How much should
Use the moment conditions 4 to derive a consistent GMM estimator of (α,Φ). Does it require knowledge of the distribution of εt? Note that we discussed asymptotic properties of
Select a share from the market like LSE, NYSE, NASDAQ, etc. [Data sources can be Datastream, Google Finance or others]. Using suitable econometric techniques analyse daily prices, returns and volatili
Prevention of main swings in economic activity could be handled most easily by house hold sector, business sector, financial sector, government sector.
A firm in a perfectly competitive market invents a new technique of production which lowers its marginal costs. What happens to its output? What happens to the price it charges?
In order to address the concern that education may be correlated with unobserved factors such as ability, you would like to use mother’s years of schooling (motheduc) as an instrument for educ
Calculate the sample mean X‾ and the sample variance S2 and construct a 95% confidence interval for the population mean.
During the 1990s, technological advance reduced the cost of computer chips. Explain, with the use supply and demand diagrams, how the following markets are affected in terms of prices and quantities
Your engineering department estimated the following production function.Q = 15L2 – 0.5L3. What is the marginal product of labor function, MPL? What is the average product of labor function, APL?
Is the sample size large enough for the estimated coefficient of square feet to be statistically significant at the 5% level? What is the coefficient of determination (R2)?
Calculate Joe’s expected utility if c1 = 0 and c2 = 100. Calculate the expected value of this lottery, and the utility of receiving this expected value with certainty
Calculate price elasticity of demand and supply for the following functions when (a) P=8 and (b), Q=6.P= 40 – 0.5Q, Q= -40 + 0.75P.
Illustrate this price/quantity combination in a graph with demand curve and marginal revenue curve.
Due to quality improvements and effective advertising, the demand increases to D2, while its corresponding marginal revenue is MR2, with ATC2 and MC2 remaining unchanged. Monopolist, hence, produces
How does a firm then maximize their total revenue? Explain the relationship of demand curve and total revenue curve, indicating which of the four types of market structures market power like this wi
‘Inflation is impossible under gold standard’. State whether this statement is true, false or uncertain? Briefly describe your answer.
Draw demand, marginal-revenue, average-total-cost, and marginal-cost curves for a monopolist. Demonstrate profit-maximizing price and amount of profit. On this graph, demonstrate the deadweight loss
The domestic demand curve, domestic supply curve, and world supply curves for a good are given by the straight lines SDemand, SDomestic, and SWorld Assume first a regime of free trade and that impor
Find out the equilibrium price, equilibrium output, unit profit, and total profit at the equilibrium point for these ingenious entrepreneurs.
Consider an individual facing a wage rate w. There is a total of 100 hrs available for work or leisure in a week.
Consider a Cournot duopoly. The market demand is p=190-q1-q2. Firm 1’s marginal cost is 40, and firm 2’s marginal cost is also 40. There are no fixed costs.Find the Nash equilibrium of t
We consider two regions A and B. Each market has the similar size (i.e. number of consumers) but differs in the willingness to pay for one unit of the good proposed by the firm. What is the optimal