Macroeconomics (Book Only)
12th Edition
ISBN: 9781285738314
Author: Roger A. Arnold
Publisher: Cengage Learning
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Chapter 21, Problem 7QP
To determine
Determine the difference between the equilibrium tuition and student tuition when instructors hold office hours.
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Imagine you are a bank manager. Currently, your bank holds $8 million in deposits at a 4% interest rate. However, you need to increase the total deposits to $10 million. The interest rate elasticity of savings is 40.
What interest rate should you offer to depositors to obtain the required amount, all other things being equal?
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A gasoline station very near a professional football stadium parks car to make money on game days. Last year it charged $4.00 per car and parked 1,000 cars. This year it raised the parking price to$ 6.00 and parked 800 cars. Calculate the total revenue. Did the station owner make a good economic decision in raising the parking prices from one year to the next?
Chapter 21 Solutions
Macroeconomics (Book Only)
Ch. 21.3 - Prob. 1STCh. 21.3 - Prob. 2STCh. 21.3 - Prob. 3STCh. 21.6 - Prob. 1STCh. 21.6 - Prob. 2STCh. 21.6 - Prob. 3STCh. 21.10 - Prob. 1STCh. 21.10 - Prob. 2STCh. 21.10 - Prob. 3STCh. 21 - Prob. 1VQP
Ch. 21 - Prob. 2VQPCh. 21 - Prob. 3VQPCh. 21 - Prob. 4VQPCh. 21 - Prob. 5VQPCh. 21 - Prob. 1QPCh. 21 - Prob. 2QPCh. 21 - Prob. 3QPCh. 21 - Prob. 4QPCh. 21 - Prob. 5QPCh. 21 - Prob. 6QPCh. 21 - Prob. 7QPCh. 21 - Prob. 8QPCh. 21 - Prob. 9QPCh. 21 - Prob. 10QPCh. 21 - Prob. 11QPCh. 21 - Prob. 12QPCh. 21 - Prob. 13QPCh. 21 - Prob. 14QPCh. 21 - Prob. 1WNGCh. 21 - Prob. 2WNG
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- Imagine you are a bank manager. Currently, your bank holds $3 million in deposits at a 3% interest rate. However, you need to increase the total deposits to $6 million. The interest rate elasticity of savings is 1.70. What interest rate should you offer to depositors to obtain the required amount, all other things being equal? Use the midpoint method and round to two decimal places throughout your calculations.arrow_forwardThe price of gasoline is currently $3.94, this is a 23% increase from a year ago. What was the price of gas a year ago.arrow_forwardinsert a formula that calculates the percentage Raymond paid of the issue price by dividing the amount Paid by the Issue Price.arrow_forward
- Pablo bought a sofa on sale for $147.20. This price was 68% less than the original price. What was the original price?arrow_forwardRefer to the article below: FRONT PAGE College Tuition Up Again College gets more expensive again. In-state tuition at public four-year colleges rose 2.3 percent in 2019-2020, to an average of $10,440 per year. Out-of-state students paid an average of $26,820 to attend. Private four-year colleges also saw even bigger price hikes: 3.4 percent-to an average of $36,880. Tuition prices have been outpacing general inflation rates for many years. Source: The College Board. If tuition keeps increasing at the same rate as in 2019-2020, how much will it cost to complete a degree at a private college in four years (2019-2023)? Hint: Future value = Present value x (1 + Growth in prices) Next year's tuition = This year's tuition x (1 + Growth in prices) Instructions: Round your responses to the nearest whole dollar. Tuition freshman year (2019-2020) Tuition sophomore year (2020-2021) Tuition junior year (2021-2022) Tuition senior year (2022-2023) Total tuition $ $ $ $ $arrow_forwardDistinguish between a rate and a price.arrow_forward
- How do I calculate new Qs for supply and demand?arrow_forwardTrue or false? The interest rate charged under credit rationing tends to be lower than the interest rate set at the intersection between the curve of demand and the curve of supply of loansarrow_forwardIn 2019, a ski resort increased the prices it charged for one-day ski passes and season passes. If someone buys a season pass, he can ski as many days as he wishes. The table below provides information on the prices and the number of passes sold in 2018 and 2019. Type of Pass One day Season Price in 2018 x 34000 $60 $1,200 Number of Passes Sold in 2018 5,000 250 Price in 2019 $80 $1,400 Given the information in the table, we know that the revenue earned from selling day passes changed by $ 52000 , and the revenue earned from selling season passes changed by $ Number of Passes Sold in 2019 3,100 190 From the answers to Part 1, we know that the demand for day passes is elastic demand for season passes is inelastic and thearrow_forward
- Refer to the article below: FRONT PAGE College Tuition Up Again College gets more expensive-again. In-state tuition at public four-year colleges rose 2.3 percent in 2019-2020, to an average of $10,440 per year. Out-of-state students paid an average of $26,820 to attend. Private four-year colleges also saw even bigger price hikes: 3.4 percent-to an average of $36,880. Tuition prices have been outpacing general inflation rates for many years. Source: The College Board. If tuition keeps increasing at the same rate as in 2019-2020, how much will it cost to complete a degree at a private college in four years (2019-2023)? Hint: Future value = Present value x (1 + Growth in prices) Next year's tuition = This year's tuition x (1 + Growth in prices) Instructions: Round your responses to the nearest whole dollar. Tuition freshman year (2019-2020) Tuition sophomore year (2020-2021) Tuition junior year (2021-2022) Tuition senior year (2022-2023) Total tuition $ $ $ tAarrow_forwardFill in the blank by typing 'increase', 'decrease', 'no change', or 'uncertain'. To receive credit, make sure to type the words in exactly as I have above. Do not include the apostrophes ('). As winter turns to spring, the weather begins to get warmer. Therefore, the equilibrium price for heavy sweaters will and the equilibrium quantity willarrow_forwardMontresor Fortunato's PED for amontillado (a pale dry sherry) is known to be 1.78 when price is measured in dollars and quantity is measured in bottles (32 oz.). What is his PED for this product if price is measured in cents and quantity in ounces?arrow_forward
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