A local restaurant giving a 10% discount to college students is an example of:

Graph an economy where your actual output is above full employment output. Use the AD/SRAS and LRAS model. Label all axis and lines accurately. a. Identify your potential or full employment output, Yf or Qf. b. Identify the actual output and price level. c. Identify the phase of the business cycle, the economy is operating within and explain how you know. d. Actual output= $750 Million Potential output =$ 600 Million MPC= .5 i. Calculate MPS. (write the formula and show all work) ii. Calculate the Spending Multiplier (write the formula and show all work) iii. Calculate the Tax Multiplier (write the formula and show all work) iv. Identify the type of Fiscal Policy to fix this economic problem. v. Calculate the maximum change to government spending, if this were the only tool utilized. (write the formula and show all work) What direction is the change? vi. Calculate the maximum change to taxes, if this were the only tool utilized. (write the formula and show all work) What direction is the change? vii. Explain how the graph changes. What shifts, what happens to output, unemployment and price level, in the short run? 2. Based off your understanding of automatic stabilizers and the above economic problem. a. Draw a graph of the Government spending and Tax revenue model. i. Label the balanced budget point with the same value as the full employment output above. ii. Label a point on the graph to show what happens when the actual output is below the full employment output. iii. State if the budget is balanced, in a deficit or in a surplus. Explain. iv. Based off the policy in d (v), explain the effect on the budget. 3. Draw the Loanable funds market in equilibrium and label the axis and curves accurately. a. Due to your answer in 2a (iv) explain how the market changes. i. Why does the market change? ii. What shifts and in which direction” iii. What happens to the real interest rate? iv. Based off the interest rate change, how will gross private investment change?

If people voluntarily contribute towards funding a public good, do you think there would be over or under-provision of the public good? Why?

What is the policy ‘remedy’ for each inflation: Demand-pull and Cost-push

Davy Metal Company produces brass fittings.  Davy's engineers estimate the production function represented below as relevant for their long-run capital-labor decisions.

Q=500L^0.6K^0.8

where Q = annual output measured in pounds,

L = labor measured in person-hours,

K = capital measured in machine hours.

The marginal products of labor and capital are:

MP_L=300L^-0.4K^0.8 , MP_K=400L^0.6K^-0.2

Davy's employees are relatively highly skilled and earn $15 per hour. The firm estimates a rental charge of $50 per hour on capital.  Davy forecasts annual costs of $500,000 per year, measured in real dollars.

1. Construct the isocost equation.
2. Draw isocost lines when budgets are  $500,000 and $600,000. (Y-Axis is Capital and X-Axis is Labor)
3. Determine the firm's optimal capital-labor ratio (K/L), given the information above.
4. How much capital and labor should the firm employ, given the $500,000 budget?  
5. Calculate the firm's output.
6. Davy is currently negotiating with a newly organized union.  The firm's personnel manager indicates that the wage may rise to $22.50 under the proposed union contract. 1)  Analyze the effect of the higher union wage on the optimal capital-labor ratio and the firm's employment of capital and labor. 2) What will happen to the firm's output?

A firm’s production function is given by q = 40 ln(EW + EB + 1) where EW and EB are the number of whites and blacks employed by the firm, respectively. From this it can be shown that the marginal product of labor is MPE = 40 / (EW + EB + 1). Suppose the market wage for blacks is $50, the market wage for whites is $100, and the price of each unit of output is $20.

(a) How many workers of each race would a non-discriminating firm hire? How much profit is earned if there are no other costs?

(b) How many workers of each race would a firm with a discrimination coefficient of 0.6 against black workers hire? How much profit is earned if there are no other costs?

(c) How many workers of each race would a firm with a discrimination coefficient of 1.2 against black workers hire? How much profit is earned if there are no other costs?

Explain three types of government policies that can encourage economic growth.

Say that Alland can produce 32 units of food per person per year or 16 units of clothing per person per year, but Georgeland can produce 24 units of food per year or 12 units of clothing. Which of the following is true?

Group of answer choices

Alland has an absolute advantage in producing food but will not trade with Georgeland.

Alland has a comparative advantage, but not an absolute advantage, in producing food.

Georgeland has both a comparative and absolute advantage in producing clothing.

Georgeland has a comparative advantage, but not an absolute advantage, in producing clothing.

Question 1

Suppose a new contracting environment with an economic environment that looks more uncertain is considered. This new contract will result in:

Question 2

Which of the following is NOT a benefit associated with producing inputs within a firm?

Question 3

By making managerial compensation depend on the performance of the firm's profits, the firm owner's profits:

Question 4

Which of the following occurs as firm size grows?

Question 5

Solving the principal-agent problem ensures that the firm is operating:

Question 6

A decrease in the marginal cost arising from a less complex specialized investment environment will cause the optimal contract length to:

Question 7

Suppose a firm manager has a base salary of $175,000 and earns 0.5 percent of all profits. Determine the manager's income if revenues are $10,000,000 and profits are $5,000,000.

Question 8

An increase in the likelihood of a dismissal:

Question 9

The agent is an individual:

Question 10

A potential problem with piece-rate plans is that:

1.

The component of spending that is responsible for most of the GDP decline during recessions tends to be

2.

Social security payments fall under which category or categories of government expenditures (CHECK ALL ANSWERS THAT ARE CORRECT!)

Between 2000 and 2018, what happened to the U.S. trade balance in services?

Explain three major shortcomings of the officially reported unemployment in portraying the state of the job market by referring to two items within each.

When can the Coase Theorem properly handle a situation where an externality exists? Provide an example.

In what types of situations can the Coase Theorem not properly handle an externality? How can they be addressed instead?

In the chain ratio method of estimating demand, a base number is multiplied by a chain of adjusting percentages. The upper limit of market demand is called market potential. The % market that willing and able to buy is available market under the current conditions.

ZIVAGO sells HDTV and a recent marketing research survey found the following information: Number of US households: 230,000
Access to HD Internet = 65% of the households.

Among the households with access to HD internet, 33% of households are willing and able to buy HDTV. Each household can buy one HDTV. Average price: $ 500

ZIVAGO wants to get 5% of the available market in the first year.

Use the chain ratio method to estimate (in units and $)

a. Potential market for HD TV

b. Available market and first-year sales forecast for ZIVAGO in units