What kind of profits does a monopolistic competitor make in the long run? Why? Cite your sources.

In passing judgement on whether monopoly power has a pernicious impact on the
economy, what set of factors would you consider? If two reasonably large firms wish
to vertically integrate, should policymakers always err on the side of caution? Discuss
and explain what set of factors they should consider. 2 pages double spaced.

I. Please mark “True” or “False” to the following statements:

(   ) 1. According to CISG, an offer can be withdrawn only when the withdrawal reaches the offeree before the offer.

(   ) 2. According to CISG, an offer must be sufficiently definite. Therefore a proposal for concluding a contract does not constitute an offer if it does not indicate the time of shipment.

(   ) 3. According to CISG, there must be a time of validity in an offer, otherwise the offer is invalid.

(   ) 4.According to CISG, an acceptance can be revoked by the offeree.

(   ) 5. Parties of an international sale of goods have contractual relationship at the time a written contract is signed.

II. Multiple choices: please choose one or more correct answers for each question:       

(   ) 1. According to CISG, the additions or modifications to which of the following terms

in an offer are considered to alter the terms of the offer materially

        A. price                B. payment    C. packing                   D. time and place of delivery

(   ) 2. A sends a proposal to B saying: “we are making you the following offer subject to our final confirmation”. This is

A. an acceptance B. a counter—offer   C. an enquiry   D. an offer     

(   ) 3. According to CISG, to constitute an offer, a proposal must

A. have a validity term for the offeree to make his acceptance

2. be addressed to specific offeree(s)
3. have the intention of the offeror to be bound in case of acceptance
4. all the terms in a contract are included

III. Please answer the following questions

1. According to CISG, list the conditions for a proposal to constitute an offer.
2. 1. List four situations that may terminate an offer.
   2. What is the legal consequence if an offer has terminated?

3. What is a late acceptance? According to CISG, how about the effectiveness of a late acceptance?

IV. Case study

Company L made an offer to company Y on March 15, subject to reply before March 23.

On March 16, Company Y replied “accept your offer if you reduce your price by 5%”. Company L did not reply. On March 20, Company Y emailed company L “accept your offer of March 15 even without 5% price reduction”.

Question: Is there any contractual relationship between these two companies? Briefly explain why.

Explain with a graph the effect of capital flight in a country!

6. Suppose that an owner of a taco food truck uses a truck (K) and her time (L) to make and sell tacos. Her production function is Q= K^.3 * L^.7, where Q is the number of tacos produced per day. Suppose that the rent on the taco food truck is $50 per day and that she wants to produce 500 tacos per day. Use calculus to:
a. derive the demand for labor.
b. show that the demand for labor satisfies the law of demand.

Determine the following situations, and how they affect the marginal cost function of a company? (Up, Down or No effect)
1. Rise in rent

2. Rise in labor wages

3. Property tax reduction

4. Drop at the price of inventory
5. A rise in yearly insurance plan

What are some criteria you can use to evaluate the quality of research?

Describe the consequences of a permanent decrease in the US Money Supply for the nominal exchange rate and for the US interest rate, in the short run as well as over time and in the long run. Draw time path plots for real money balances in the US, the nominal exchange rate, and the interest rate. Explain how your results relate to the idea of “exchange rate overshooting,” in no more than one paragraph.

discuss the role of leadership in building innovation capability

Suppose the market for rental housing is

An increase in demand for rental housing will create a shortage of rental housing.

b. A rent control policy imposed below the equilibrium rent will create a shortage of rental housing.

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. For each of the following two statements explain whether the statement is true, false or uncertain.

1. An auto supplier installed new equipment costing $1,050,000. The equipment generated new income averaging $275,000 per year, and its operating costs averaged $50,000 per year. The equipment was depreciated using the MACRS method, assuming a 7-year recovery period and no salvage value. However, the equipment was kept in service for a total of 10 years, after which time a scrap dealer bought it for $75,000. The company has a combined effective federal and local tax rate of 26%, and uses an after-tax MARR rate of 8%. Determine the equipment’s after-tax net present worth over its 10-year service life.

[Answer: $302,000]

The Covid-19 situation has triggered an economic crisis and created massive economic hardship globally. Unlike the 2008-09 financial crisis, the Covid-19 crisis began in the real economy, not in the financial sector. Its effects have, however, propagated to the financial side of the economy.

a. Policy responses: Governments and Central Banks have implemented a number of policies to mitigate the economic damage from Covid-19. Describe in detail the policies that fit in the (i) fiscal policy category, and (ii) those that fit in the monetary policy category. Provide as much detail on the policies as possible and explain briefly how they work in the current context.

b. Private sector responses: The private business sector has many options to respond to the economic crisis caused by Covid-19. Describe in detail the different options that are available to private sector operators. Identify any interactions between their actions and some of the fiscal and monetary policies you identified in part (a). Do you see sectors that are more heavily exposed than others? Discuss.