An economy has 100 workers producing two goods: coffee and grinders. Each worker can produce either two tons of coffee, or one grinder a year. Currently, 60 workers produce coffee, and the rest produce grinders. The price of a ton of coffee is $150, and that of a grinder is $300. Each worker earns $250 in wages a year. The government sector buys 40 tons of coffee a year. There is no depreciation or ROW in this economy. Assume that firms distribute ALL of their profits to the households as dividends.

1. Calculate the level of consumption, investment, government expenditures, and national product. Show your work!

2. The government taxes households’ income at 10%. Calculate the level of government tax revenues, and the government’s budget, and classify as surplus, balanced, or deficit.

3. Calculate savings of the household and firm sector as well. Verify that aggregate savings equals investment in this economy.

Bubba’s Burger Shack is the only cafeteria in a minimum-security prison; it sells burgers and fries. There are four different types of customers with the following willingness-to-pay or reservation prices for the two products:

Fries Burgers
Type I   $3.60   $0.30
Type II   $2.00   $2.00
Type III   $1.60   $2.40
Type IV   $0.10   $3.80
The cost of making an order of fries is constant at $0.80 and the cost of producing a burger is also constant at $1.20.

(a) Calculate Bubba’s profits if the Burger Shack follows a standard pricing policy and prices burgers and fries separately.

(b) Calculate Bubba’s profits if the Burger Shack follows a pure bundling strategy and sells burgers and fries together as a combo meal.

(c) Calculate Bubba’s profits if the Burger Shack follows a mixed bundling strategy, i.e. it sells burgers and fries as combo meal and burgers and fries separately.

Q2. What is the law of diminishing marginal productivity? How does the law of diminishing marginal productivity affect the cost of productions?

Provide an example from your workplace.

Impact of Corona Virus (COVID-19) on the economy?

What is the importance of internal communication in the workplace?

1. Fertility rates have important economic effects. Discuss at least one direct and one indirect effect of fertility on economic development.   

Use the data reported by the labour force force survey in July 2014 to answer the following questions.

Statistics Canada’s labour force survey reported the following situations in July 2014:

Sarah works 10 hours a week at McDonald’s. She’s available to work more hours but hasn’t looked for extra work.

Kevin spent the first six months of 2014 actively searching for a job but didn’t get hired. He believes there are no jobs so he has given up looking.

Pat quit the job he had for the past two years and is actively looking for a better paying job. He is available to work and he still searching for a job.

Mary is a new graduate who was hired while she was a student to start a job in August.

Johnny quit his band in June and has no job in July and is not looking for work.

Who does the LFS classify as being unemployed, a part-time worker, unemployed person, I discourage searcher, and not in the labour force?

_______ are unemployed, ______ is a part-time worker, _____ is a discouraged searcher, and ______ is not in the labour force?

A) Pat and Mary; Sarah; Kevin; Johnny

B) Pat and Kevin; Mary: Johnny; Sarah

C) Mary and Kevin; Pat; Johnny; Sarah

D) Mary and Sarah; Kevin; Johnny; Pat

How will the labour force change if the following events occurred?

1. Sarah start a second job
2. Pat finds a good job and is hired.
3. Mary takes a job at McDonald’s was she waits to start her new job.

A) Event 2 will decrease the labour force while 2 and 3 will increase it.

B) Events 1, 2 and 4 will not change the labour force.

C) Event 1 will not change the labour force, 2 will increase it and 3 will decrease it.

D) Event 1 will increase the labour force, but events 2 and 3 will decrease it.

How will the unemployment rate change if Sarah quits and starts to search for a full-time job?

A) rise

B) fall

C) remain unchanged

How will the labour force participation rate change if Kevin starts creating football apps in his garage and they turn out to be popular?

A) rise

B) fall

C) remain unchanged

Why did the USA have a great recession during 2007 to 2009 period? Was it cause by the financial crisis? Briefly explain. You may use parts of your research paper to answer the question.

Explain how an economy can experience long-run economic growth and deflation at the same time?

Compile a PowerPoint presentation to demonstrate your ability to provide a comprehensive presentation on the following:

• How does an increase in fiscal policy affect consumers' ability to purchase the iPhone 6 plus?
• How does a decrease in fiscal policy affect consumers' ability to purchase the iPhone 6 plus?
• Does monetary policy affect the sale and purchase of the iPhone 6 plus in a negative manner?
• Does monetary policy affect the sale and purchase of the iPhone 6 plus in a positive manner?

Coyote, Inc. sells in two markets, Market A and Market B.  Demand in Market A is Q_A = 80 - 2P_A and demand in Market B is Q_B = 120 - 4P_B.   For any given output Q, Coyote's cost of production C(Q) = 50 + 10Q + 0.125Q². If Coyote is able to practice 3rd degree price discrimination between these markets its maximum profit will equal ________.

(a) What is the compensating variation? What is the equivalent
variation? What is the di¤erence between them?
(b) You consume two goods, good x and good y. These goods sell
at prices px = 1 and py = 1, respectively. Your preferences are
represented by the following utility function: U(x; y) = x + ln(y):
You have an income of m = 100. How many units of x and y
will you buy and what will is your utility? If px increases from
$1 to $2; gure out the compensating variation (CV) associated
with price change.
(c) If instead your utility is U(x; y) = ln(x) + y; gure out the com-
pensating variation (CV) as px increases from $1 to $2:
(d) Are the compensating variations the same for both of the above
utility functions? Explain your answer rigorously.

Gasoline is sold through local gas stations under perfectly competitive

conditions. All gas station owners face the same long-run total cost function given by:

LRTC= 0.01q³-2q²+101q

                        Where q is the number of gallons sold per day.

1. Assuming the market is in long-run equilibrium, how much gas will each firm sell per day? What is the value of long- run average cost at this output level? What is the long run equilibrium price?

        (b) The market demand for gasoline is given by:

Q_D= 2,500,000 - 500,000P

Where Q_D is the number of gallons demanded per day and P is the price per gallon. Given your answer to part (a), how much gasoline will be demanded and how many gas stations will there be?

        (c ) Graphically Show your results.