In a Harrodian economy, ICOR is 4.5 : 1, population growth is 2% per annum, and the investment rate is 27%. Hence the annual growth of per capita will be
Suppose a firm with market power faces the following inverse demand P=4-(Q/20) The firm has the cost function C= 100 +8.4Q-(5/4)Q^2+(1/30)Q^3. Answer
a.Calculate the firm's market power as measured by the Lerner Indec.
b. Suppose the firm is contemplating investing $5 in R&D that , if successful, would change the demand to P=6-(Q/20) and the cost function to C=50+8.5Q-(7/10)Q^2+(1/60)Q^3. Find the minimum probability of success needed to convince the firm to invest in the innnovation.
In the most recently presidential election, Donald Trump won the electoral college vote, but lost the popular vote by 3 million votes. With this in mind, should the electoral college be abolished? What would have to happen to bring about a movement to do away with it? Who might support this effort? Who would be likely to oppose it?
You are given the following information about the economy: autonomous consumption = $300 billion planned investment = $300 billion government spending = $500 billion mpc = .8 imports = $200 billion exports = $500 billion
g. If full employment Y = $6000 billion, is there a recessionary or inflationary gap?
h. If full employment Y = $6000 billion, what is the GDP gap?
i. What kind of fiscal policy (expansionary or contractionary) could help the economy close the gap?
j. If you decided to change government spending, how much would you change G to close the GDP gap?
k. If the value of the dollar depreciated, how would this affect net exports? AD?
What is the efficient allocation of a two period model, given a constant demand curve, P= 20 – Q, a discount rate of 10% and a MC=6. Assume the total supply is estimated to be 20 units
In the two-period model the consumer aimed to die with zero assets. What would be the planning horizon of parents who wished their children to enjoy the same standard of living that they experienced? What is the planning horizon if every generation feels this way? Does every generation feel this way?
please reflect on the economic effects of the lifting of sanctions against Iran as a result of the Agreement. Who benefits from lifting the sanctions? Are sanctions a smart tool of foreign policy?
Heavy Water Project (Talcher) and Fertilizer plant (Paradeep) are famous industries of
A) Andhra Pradesh
B) Tamil nadu
A monopolist has access to an industry with market demand P = 9-y, where y is the firm’s quantity. Its cost function is C(y) = 5y. The government can use a subsidy to influence the monopolist to produce the efficient quantity in this market.
a) Would the firm ever operate at a point elasticity less than 1? Explain.
b) Solve for the efficient outcome, and determine the per-unit subsidy that must be used.
c) Determine the cost to the government of this subsidy.
d) Should the government engage in this subsidy policy? Explain.
During the improving economic conditions of 2015 and early 2016 much additional construction of homes and condos throughout much of the U.S. took place. This provided a significant increase in the income of workers in the construction trades. Many of the construction workers were immigrants and have family and relatives in other countries. Often these workers would send part of their income to their less fortunate relatives in their old country, especially in Mexico and some of the South American countries. Which of the economic principles best describes this situation?
A main advantage of specialization results from:
a. Economics of large scale production
b. The specializing country behaving as a monopoly
c. Smaller production runs resulting in lower unit costs.
d. High wages paid to foreign workers
A primary reason why nations conduct international trade is because:
a. Some nations prefer to produce one thing while others produce another
b. Resources are not equally distributed to all trading nations
c. Trade enhances opportunities to accumulate profits
d. Interest rates are not identical in all trading nations
What is meaning of liquidity adjustment faclity?
A. The facility extended by Reserve Bank of India to scheduled commercial banks to avail liquidity in case of requirement.
B. The facility extended by Reserve Bank of India to scheduled commercial banks to park excess funds with RBI.
C. It refers to sale and purchase of govt. securities by RBI from the market.
D. It refers to grant of loan by RBI to commercial banks against collateral of govt. securities commercial banks against collateral of Govt securities .
According to Reserve Bank of India, banks can open a savings bank account in the name of a minor to be operated by him independently. What is the minimum age prescribed for opening of such accounts?