4. Common resources and the tragedy of the commons

Rajiv, Yakov, and Charles are lumberjacks who live next to a forest that is open to logging; in other words, anyone is free to use the forest for logging. Assume that these men are the only three lumberjacks who log in this forest and that the forest is large enough for all three lumberjacks to log intensively at the same time.

Each year, the lumberjacks choose independently how many acres of trees to cut down; specifically, they choose whether to log intensively (that is, to clear-cut a section of the forest, which hurts the sustainability of the forest if enough people do it) or to log nonintensively (which does not hurt the sustainability of the forest). None of them has the ability to control how much the others log, and each lumberjack cares only about his own profitability and not about the state of the forest.

Assume that as long as no more than one lumberjack logs intensively, there are enough trees to regrow the forest. However, if two or more log intensively, the forest will become useless in the future. Of course, logging intensively earns a lumberjack more money and greater profit because he can sell more trees.

The forest is an example of   because the trees in the forest are   and   .

Depending on whether Yakov and Charles both choose to log either nonintensively or intensively, fill in Rajiv's profit-maximizing response in the following table, given Yakov and Charles's actions.

In which of the following does the Federal Reserve Bank not play a role?

A. moderating long term interest rates

B supervising and regulating banks

C controlling the size and growth of the money supply

D stabilizing prices

Keynesian economics holds that

A recessions could be so long that typical models of economic collapse and recovery may not work

B. the markets invisible hand needs occasional help from government intervention

C All of these answers

D economic growth is closely tied to the ability of individuals to consume goods

Much of what became the Affordable Care Act also known as Obama Care was drawn from proposals originally developed by

A Bill Clinton

B Mitt Romney

C Hilary Clinton

D George H. W Bush

A car assembly company ASSEMCO is legally obligated by a contract to buy 25 engines from ENGCO at the end of two years at a price of $5000 per engine. Accordingly, ASSEMCO started assembling cars that Öt ENGCO engines. In the second year, due to some events in the car manufacturing industry, ENGCO decides to increase the price of their engines, or otherwise it will go bankrupt. What should the manager of ASSEMCO do in this case? How could this problem have been avoided? Did the manager choose the wrong method of procuring inputs?

Why is the “labor participation rate” important? By referring to three real world cases (one being the increase in women’s participation in the labor force) explain how social and economic changes can affect this variable?

Identify the type of specialized investment that each of the following situations require: 1. You need to hire an employee to operate a machine that only your company uses. 2. Your input supplier is far away from your facility. 3. You need your supplier to provide you with an input that they do not usually produce and that only you can use in the production process

Explain why a negative externality in production results in too much of the good being produced from society's perspective, whereas a positive externality results in too little being produced. How, according to Pigou, might such over- and under-allocation of resources be corrected?

1. Research the importance and levels of investment spending in the US.

2. Explain the Interest Rate effect on business borrowing and levels of employment.

3. Collect official data on the Investment level in the US. See Instructions in the important document.

Describe existing safeguards used to ensure providers provide quality care, due to lack of sufficient financial incentives.

Why is the “labor participation rate” important? By referring to three real world cases (one being the increase in women’s participation in the labor force) explain how social and economic changes can affect this variable?

GAME THEORY AND OLIGOPOLY. Profit payoff Matrix for Subways and Quiznos (Sandwich Style Resturants. Below is the profit payoff matrix for these two restaurants depending on whether they set their Chicken sandwich price HIGH or LOW

a) Using Table, what if any is the collusive outcome? Explain whether it will occur.

b) Using Table, what if any is the Nash equilibrium? Explain whether it will occur.

c) What is meant by a dominant strategy? Using Table 2, is there a dominant strategy? Explain, and determine which outcome will occur?

E-commerce

what are six behaivor- based of internet users

Katherine has an estimated Cobb-Douglas utility function of U = q1^0.25q2^0.75 for food, q1, and housing, q2. The price for food is arbitrarily set at $1 per unit and the average monthly rent near the University of Chicago , p2, is a dollar fifty per square foot. Caroline, like the average University of Chicago student spend $750 on food and housing per month.

     (a) Using calculus, solve for Katherine's optimal quantities of housing and food. Provide the marginal utility of income.

     (b) What is Katherine's utility at the optimal bundle?

     (c) Due to panic buying and logistical difficulties due to the coronavirus, suppose the per-unit price of food increases by 25% (p1= $1.25), what is Katherine's new utility facing this price increase?

     (d) How much money would Katherine need to completely offset the harm from the price increase?

     (e) How much money would one have to take from Katherine to harm her as much as the price increase?

what are two examples of events/variables that could shift the demand for labor, and why they could shift it.

Imagine you are a consultant who has been asked to summarize the strengths and weaknesses of Agoria, a nation with a pure market economy.

Which of the following would you include in your report as weaknesses of Agoria's economy? Check all that apply.

- Occupational choices can be restricted.

- Firms have no incentive to produce the so-called public goods, such as national defense, because private firms cannot prevent nonpayers from enjoying the benefits of public goods.

- People with no resources to sell could starve (income is distributed unequally).

- The economy experiences economic fluctuations, which are alternating periods of expansions and recessions in their level of economic activity, especially in employment and production.

Over the last 10 years, in Canada and the United States, corporate bond yields have fallen (relative to previous time periods) to very low levels and during the same period both countries have experienced low rates of economic growth. Give two reasons to explain why bond yields in Canada and the U.S. have fallen to low levels over the last 10 years. Note: No diagram is needed to answer this question, you can provide your answer in words.