11. Theory and Evidence: "Prices gouging" is the practice of raising the price of essential goods during a shock to demand. An example is the demand for facemasks in the summer of 2020. Increases in price often cause distress, which has led policymakers to consider banning price increases during crises. Consider the costs and benefits of this policy in a supply and demand framework.
Q: The natural rate of unemployment is determined by which of the following: (i) fraction of people who…
A: Natural rate of unemployment is the rate of unemployment that exists even at the state of full…
Q: Specifically, this insert begins with the conjecture that at this juncture, opinions differ on the…
A: The international institutions help in managing trade concerns among the countries and providing a…
Q: Suppose that population growth increases. The Solow growth model with population growth and…
A: A macroeconomic model that describes long-term economic development in an economy is the Solow…
Q: Jennifer is working on a word puzzle and is looking for four-letter "scrambles" form the clue word…
A: Jennifer is working on a word puzzle and is looking forfour-letter "scrambles" from the clue word…
Q: Would a cost function of 0 mean a linear line of supply curve? For example if 10 firms are on the…
A: A cost function is a mathematical function that is used to show the general relationship between the…
Q: When it comes to making suggestions, does Porter's published work incorporate any particular types…
A: Michael Porter is a well-known management strategist and author who has published a lot of work on…
Q: (a) Immediately after the central bank's open-market bond purchase, will JMH Bank's liabilities…
A: Required reserves ratio represent the minimum amount of funds that the commercial banks are supposed…
Q: To address the problems created by the pandemic, suppose the private sector has been permanently…
A: The capital per effective worker is the capital that is available for the worker who can use the…
Q: Two business partners have the opportunity to undertake a new project which will lead to a profit of…
A: A Nash equilibrium in game theory refers to a set of tactics where no player, given the strategies…
Q: Current ‘Quantitative Easing’-programme (QE) of ECB is not supported by the independence of the ECB…
A: The European Central Bank is the main governing body of the Euro system. Founded on 1 June 1998 in…
Q: For the net cash flow series shown, find the external rate of return using the ROIC method at an…
A: The rate of return employed in capital planning is known as the external rate of return and is based…
Q: From the data in the table about demand for smart phones, calculate the price elasticity of demand…
A: Price elasticity of demand is a concept to understand the effect of price change on the demand of a…
Q: Assume a country's economy is currently in a recession. (a) Draw a correctly labeled graph of the…
A: An economy that has significantly slowed down or contracted is in a recession. A big drop in…
Q: P P₁ P₂ Pr NO Po Market for Good X Q₁ Q₂ S D Q Refer to the Market for Good X above. Po-$5, P₁-$35,…
A: Price floor: Price floor is a govt-imposed price control. When the govt decides that the market…
Q: The proponents of the hysteresis hypothesis argue that: (i) the short-run and the long-run…
A: Hysteresis is the term used in economics to describe an economic event that continues long after the…
Q: An IT company is planning to introduce a new product. In order to predict its sales, they release…
A: An economic hypothesis is a statement or a set of statements that attempts to explain or predict…
Q: In macroeconomics, the immediate short run is known as a length of time when both input prices and…
A: In the immediate Short run, the input prices and the output prices are fixed. In the short run, one…
Q: . Using the data under D₁ and D2, calculate the cross elasticity of Ariya's demand for golf at all…
A: The cross elasticity of demand is a measure of the responsiveness of the quantity demanded of one…
Q: 1. Ana is scouting a DLSR cam to cover her parents' silver wedding anniversary. She found one at…
A: A table containing information on a loan or other financial product that amortizes over time, like a…
Q: Assuming zero disposal costs, why is the correct profit maximising price to charge for the unsold…
A: The elasticity of the demand refers to the degree of responsiveness of change in the demand with…
Q: Question 1 (i) The UK inflation rate is predicted to be 10% and the Eurozone inflation rate is…
A: The standard rate at which one currency can normally be translated into another is known as the…
Q: 2. The table below lists the labor hours required to produce one unit of guns (G) and one unit of…
A: The opportunity cost is defined as the number of other good foregone to make 1 unit of good
Q: Supply and demand In the market for widgets, the supply and demand curve are "normal" 45° lines. The…
A: Implementation of maximum price is a type of price control. The government implements maximum price…
Q: Refer to the following statements for items 6-9. 1. The TRAIN Law which includes a cut in personal…
A: Fiscal policy refers to the policy adopted by the government to control the money supply of the…
Q: Consider the endogenous growth model with two sectors: manufacturing firms and research…
A: Endogenous growth theory emphasizes the significance of population expansion, human capital, and…
Q: A company has issued 10-year bonds, with face value of 1,000,000 in 1,000 units. Interest at 16% is…
A: Fundamentally, engineering economics entails articulating, calculating, and assessing the economic…
Q: Can the slope of yield curve predict future economic growth? Why?
A: The yield curve in economics can be defined as a curve that depicts the rate of interest that is…
Q: 3. What are major assumptions of classical economics? Explain briefly item by item and make a…
A: Since you have posted multiple questions, we will provide the solutiononly to the first question as…
Q: A consumer has a utility function U(X,Y ) = X1/2 Y1/2 . Prices of the goods are pX = £10 and pY =…
A: The utility is the satisfaction that is derived from the consumption of the goods or services. The…
Q: Which of the following can shift the short-run Phillips curve upward? (i) Increase in expected…
A: Phillips curve shows the relationship between the unemployment rate and the inflation rate. The…
Q: Assume that a monopolistically competitive industry is in the long-run equilibrium. Show the effect…
A: Monopolistic competition is the market model of economy which contains many seller selling but not…
Q: Theory and Evidence. Childcare is a sector that is heavily regulated because of the importance of…
A: The basic tenets of economics are supply and demand, which explain the link between the quantity of…
Q: An analysis of the impact of entrepreneurship on the economy
A:
Q: The proponents of rational expectations argue that it is possible to reduce inflation without…
A: Rational expectations is a theory in economics that states that individuals and firms will make…
Q: 1) What are the key differences between the theory of multinational enterprises and conventional…
A: Trade: The primary theory of economics includes the buying and selling of goods and services with…
Q: Explain reasons why voters should care about high inflatIon?
A: Inflation is the rate at which the price of products and services rises. As an outcome of inflation,…
Q: 1. Define spot exchange rate and forward exchange rate. Define and compare accounting exposures and…
A: The cost of one currency in terms of another currency is known as an exchange rate. It is a measure…
Q: Old Southwest Canning Co. has determined that any one of four machines can be used in its…
A: Given that; Rate of return is 25% Life of machine is 5 years Machine First Cost$ AOC$ 1 -28000…
Q: Game theory sider a simultaneous move game with two players. Player 1 has three possible actions (A,…
A: The Nash Equilibrium refers to the best course of action of a firm provided the action of rival firm…
Q: Calculate the Nominal and Real Exchange Rate Indices for the euro in periods 1 to 5. $/€ rate US…
A: The exchange rate that depicts the number of units of domestic currency (here, dollar) that is used…
Q: Which of the following describes the steepest investment schedule? O a. 1=450-8(3) O b. 1=450-2(3) O…
A: The standard investment schedule is of the form :- i= a - b r a is the autonomous investment and is…
Q: How does the idea relate to the definition of economics? allocating a square block in the heart of…
A: Opportunity cost: Opportunity cost signifies all the alternative benefits sacrificed to obtain one…
Q: Figure 14-1 Suppose that a firm in a competitive market has the following cost curves: Refer to…
A: When we talk about market arrangements that have lots of customers and sellers of similar goods and…
Q: How much units of labour will he hire if he wants to miminize his total costs? 1587,4 839,95 3000…
A: The labour that would minimise the cost in order to produce the given amount of output is actually…
Q: a. Bing Ltd a UK based company is due to pay 80 million Lira to Google Ltd. The spot rate is Lira…
A: Solution of both a and b are as follow:
Q: The government considers a Help for Houshold scheme to provide help for the rising energy costs…
A: A tax is the payment from the public side to the government or the state. It is a form of financial…
Q: Cleanville Environmental Services is considering investing in a new water treatment system. On the…
A: MARR refers to minimum accepted rate of return which an investor requires from the investment…
Q: If the government raises income taxes on Americans in the top one percent of earners, while…
A: A progressive tax has a tax rate that rises (or progresses) as total income does. It levies more…
Q: The banking industry is impacted by changes in its external environment from political, economic,…
A: The banking industry operates as a network of financial institutions, which offers many services…
Q: I need help describing the key assumptions that characterize a perfectly competitive market and…
A: Perfect competition is a kind of market structure that enables several firms to provide the same…
Please answer question 11
Step by step
Solved in 2 steps with 1 images
- What is the difference between a fixed input and a variable input?Suppose college graduates earn $25 an hour and high school graduates earn $5 an hour. Suppose too that the marginal product of college graduates at Johnson Tools is 8 hammers per hour, while the marginal product of high school graduates is 4 hammers per hour (regardless of the number of each type of worker employed). a. What is the least-cost production method for producing 100 hammers in an eight-hour day? O Hire one-third college graduates and two-thirds high school graduates. O Hire two-thirds college graduates and one-third high school graduates. Hire only high school graduates. Hire half college graduates and half high school graduates. O Hire only college graduates. b. What if the marginal product of high school graduates was instead 2? O Hire half college graduates and half high school graduates. Hire only high school graduates. O Hire two-thirds college graduates and one-third high school graduates. O Hire only college graduates. O Hire one-third college graduates and…Suppose Charles owns a lawn mowing company, Assume that without workers, no yards are mowed. When he hires one worker, he is able to mow 3 yards per day. With two workers, he can mow 7 yards per day, and with three workers, he can mow 12 yards per day The marginal product of the first worker is yards per day The marginal product of the second worker yards per day.
- If capital and labour are perfect complements then the marginal products of capital and labour are undefined A True Faise Question 16 A firm uses 10 units of labour and 20 units of capital to produce 10 units of output. The marginal product of labour is 0.5. If there are constant returns to scale the marginal product of labour must be 0.25 True B False Question 17 Afirm uses 10 units of labour and 30 units of capital to produce 10 units of output. The marginal product of labour is 05. If there are constant returns to scale the marginal product of labout must be 0.25 A True FalseA firm can use three different production technologies, with capital and labour requirements at each level of output as follows: Technology 1 Technology 2 Technology 3 Daily Output K L K L K L 100 3 7 4 5 5 4 150 3 10 4 7 5 5 200 4 11 5 8 6 6 250 5 13 6 10 7 8 a. Suppose the firm is operating in a high-wage country, where capital cost is $100 per unit per day and labour cost is $80 per worker per day. For each level of output, which technology is the cheapest? Now suppose the firm is operating in a low-wage country, where capital cost is $100 per unit per day but labour cost is only $40 per unit per day. For each level of output, which technology is the cheapest? Suppose the firm moves from a high-wage to a low-wage country but its level of output remains constant at 200 units per day. How will its total employment change?In the Cost Minimization Problem, the isoquant curve for an output level equal to the output quota? Illustrates the cost of labor and capital a firm pays to produce a level of output in excess of an output quota. Illustrates all combinations of labor and capital that a firm cannot afford. Illustrates all combinations of labor and capital that a firm can afford. O Illustrates all combinations of labor and capital that a firm can use to produce a level of output equal to the output quota.
- A software firm has only two inputs to production: domestic programmers based in the firm’s U.K. office and international programmers working from home in low-cost countries.The two types of programmers are perfect substitutes but domestic programmers are more productive due to better communication in the office. The production function is:S = 2D + IWhere S is the amount of software written, D is the number of domestic programmers and I is the number of international programmers. Programmers can work part-time, so hiring 0.3 of a programmer would be possible. (c) The government is concerned about diversity and writes a law saying that at least two workers in any firm must be domestic, and that at least two workers must be international. Show the effect of this law on the firm’s isoquant, the number of each type of worker hired, and total costs.A software firm has only two inputs to production: domestic programmers based in the firm’s U.K. office and international programmers working from home in low-cost countries.The two types of programmers are perfect substitutes but domestic programmers are more productive due to better communication in the office. The production function is:S = 2D + IWhere S is the amount of software written, D is the number of domestic programmers and I is the number of international programmers. Programmers can work part-time, so hiring 0.3 of a programmer would be possible.(a) The firm must produce 10 pieces of software this year. Show the firm’s isoquant in a suitably labelled graph. Put “domestic programmers” on the vertical axis and “international programmers” on the horizontal axis. Label each axis from 0 to 10.Consider two farms, A and B. The input use and output are given in the following table. The wage = $80 per day and rental price of the machines = $100 per day Farm Labour(L) Physical capital(K) Output(Q) Q/L Q/K TFP A 2 2 200 ? ? ? B 4 1 200 ? ? ? Which farm is more productive according to the productivity measures? Which of the three measures is the most informative measure of agricultural productivity? Why?
- USE R LANGUAGE TO SOLVE THE equation The output of a production process, Q is given by the function2K^(-3)L^(5/2)/2K log4 6L^2where K and L denote capital and Inbour. Calculate the output when the capital and labour are 10 and 20 units, respectively.Please only do 4 and 5 not 1 2 or 3 Suppose a firm’s production function is K^1/3 L^2/3 Mpk= L^2/3 / 3K^2/3 MpL=2K^1/3 / 3L^1/3 The rental rate of capital is $52, and the wage rate is $13. What is the cost minimizing capital to labor ratio? How many units of capital and labor should the firm use to produce 1200 units of output How much would it cost the firm to produce 1200 units? What is the short run and long run total costs of decreasing output to 1000 units? Assuming relocation is costless, should the firm relocate to a new location where w=15, r=40?3.5 A firm can use three different production technologies, with capital and labor requirements at each level of output as follows: Daily Output 100 150 200 250 Technology 1 K 4 5 6 7 L 6 9 12 15 Technology 2 Technology 3 K 2 3 L 8 10 14 18 K 5780 L 10 3582 6 a. Suppose the firm is operating in a high-wage country, where capital cost is $150 per unit per day and labor cost is $100 per worker per day. For each level of output, which technology is cheapest? 12 b. Now suppose the firm is operating in a low-wage country, where capital cost is $150 per unit per day but labor cost is only $60 per unit per day. For each level of output, which technology is cheapest? c. Suppose the firm moves from a low-wage to a high-wage country but its level of output remains constant at 100 units per day. How will its total employment change?