Difference between a firm's accounting and economic profit in your own words at least 250 words. and  Looking at a marginal and average total cost in your own words at least 250 words.

1. Kent sells lemonade in a competitive market on a busy street corner. His production function is F(L, K) = L^1/3 K^1/3 where output q is gallons of lemonade, K is the pounds of lemons he uses and L is the number of labour-hours spent squeezing them. The corresponding marginal products are MPL= 13L-23K13 and MPK= 13L13K-23. Every pound of lemons cost r and the wage rate of lemon squeezers is w.
   1. Prove that this production process has decreasing returns to scale.
   2. On a graph with hours of lemon-squeezing (L) on the horizontal axis and pounds of lemons (K) on the vertical axis, illustrate an isoquant that represents a particular production level q. What is the equation of the isoquant?
   3. What is the equation for a slope of an isoquant? Is it constant? What does the slope indicate? Explain.
   4. What are the conditions that identify the cost minimizing bundle for any output? Illustrate on a clearly labelled diagram.
   5. Set up the cost minimization problem and solve for the conditional input demands as functions of the exogenous variables.
   6. Derive the cost function (as a function of only the exogenous variables).
   7. Continue with total cost function derived in previous part and derive the average cost. Is it upward or downward sloping? Explain.

Suppose the overnight market rate is below the target rate set by the Bank of Canada (BoC). To reduce the downward pressure on overnight rate, the Bank of Canada decides to use open market operations with a target volume of 100 million dollars.
(a) Describe the actions BoC can undertake to intervene in the overnight market.

(b) Using T-accounts, record the changes in balance sheets of BoC and the financial system following BoC’s intervention.

1. Write an essay (minimum of 3000 words) on the following. COVID-19 has caused global turmoil to humankind. Concentrate on the economic impact of this horror and use as many concepts, tools and techniques that you can from this course to analyse the economic impacts of this disease. You are required to include the global oil industry in part of your analysis, but you may include any other industries of your choosing to analyse also. You may concentrate on one country or many if you wish, but how you choose to proceed is up to you. Your essay will be judged on the quality and depth of economic analysis as well as organisation and clarity of your prose.

what is the implication of the new Keynesian economics on the role of monetary policy in stimulating economic growth.(please explain in detail)

4. What is the meaning of this equation: Total Spending (GDP) = C + I + G + (X-M)? What information does this equation try to communicate to us? Why? Why should we care about this information?

5. In theory, what is so ‘unique’ and ‘special’ about Business Spending (I)? One can argue that this area of spending is MUCH MORE IMPORTANT than “just 17% of Total Spending”---why may this be true?

6. In theory, what must a firm be thinking in order to START the process of building factory #5? How and when and why might the firm give itself “the green light”??

1. Solow Country in steady state
   1. Savings rate of this country were to increase, name the effects of capital labor ratio & real GDP per capita?
   2. Population growth is experiencing decrease, what impact would this have on the capital-labor ratio, real GDP growth and real GDP per capita?

How was slavery practice in England before the transatlantic slave trade?

List and explain extensively 5 issues with product liability law in practice

The Affordable Health Care Act was designed to address several deficiencies in the delivery of health care in the U.S. Please explain how the Affordable Care Act addresses:

1. The availability of health insurance outside of employment

2. Dependent children of insured families

3. Financing the insurance subsidies embedded in this program

b) Explain why the Phillips curve relationship in the basic New Keynesian model takes the form it does.

Jim Young/Reuters

Screw the passengers.

That appears all too often to be the governing philosophy of the airline business.

Take the case of a United Airlines flight from Chicago to London last weekend. A technical problem forced the plane to abort its trans-Atlantic route and divert to Goose Bay in Canada. The 176 passengers were marooned there for more than 20 hours, sleeping in unheated military barracks at near-freezing temperatures.

“There was nobody from United Airlines to be seen anywhere,” one passenger told NBC News. “No United representative ever reached out to anybody, no phone calls, no human beings, no nothing. Nobody had any idea what was going on.”

It so happened that this came at the end of a week in which the world’s airline chiefs, junketing in Miami, celebrated their most lucrative year ever. They are projecting profits totaling $29.3 billion in 2015—almost double what they made in 2014.

And you must have noticed if you’re flying anywhere in the U.S. this summer that seat prices are not falling. Indeed, if the owners of those seats are suddenly feeling fat and happy, they are in no mood to pass on their swell feelings to you. It’s hard to imagine any other service industry being run like the airline business—but then there is no other business like the airline business.

So now we have a novel opportunity to see how airlines behave when, suddenly and much to their surprise, they find themselves with a business model that is working. If making a profit is a new experience for them, what effect will that have on their behavior?

First, let us consider why the numbers have been transformed.

There has been a steep change in the efficiency of jets. Beginning with the Boeing 787 Dreamliner, the combination of lighter but stronger composite materials in structures and a quantum leap in engine efficiency, using far less fuel, has slashed operating costs per airplane by as much as 30 percent.

In the last year, this windfall has been boosted by the large decline in oil prices.

However, these dual benefits are not being evenly spread either among airlines or continents. Airlines stuck with fleets of older airplanes are not getting these benefits. Fleet age has become far more decisive in deciding an airline’s profitability, particularly true in the U.S.

The three major U.S. legacy carriers—American, United, and Delta—failed to get in early to order the new generation of airplanes—the 787, the Airbus A350, revamped versions of the Boeing 777, the Airbus A320, and the Boeing 737—and allowed European, Middle Eastern, and Asian competitors to become first adopters and, thereby, reap the benefits of lower fuel costs.

The average age of the jets in the American fleet is 12.3 years; for United 13 years; and for Delta 17.2 years. It won’t be until at least 2020 that they can finally dump the oldest of their airplanes. (American has actually been delaying the delivery of some new jets that it ordered.)

Age doesn’t mean that an airplane is unsafe. Properly maintained 20-year-old jets are not in danger of falling apart. The frequency of flights determines retirement age more than years and the smaller single-aisle jets used on domestic routes age the fastest because they are making up to seven flights a day.

Age may not be dangerous but it sure registers with passengers when it contrasts with the comforts they encounter in the new generation of jets with their better cabin climate and quieter engines. So it’s not surprising that when airlines show up with all-new fleets as well as gracious cabin crews people start wondering, Why can’t it always be like this?

It’s also not surprising that the major American carriers are now trying to stop those airlines from coming to an airport near you.

When it comes to price and the domestic U.S. routes, not only are prices not coming down but there is persuasive evidence of price-fixing. The veteran investigative reporter James B. Stewart described this market as a classic oligopoly in a penetrating piece in The New York Times .

However, this is far from being a new phenomenon. These tactics began long before the final round of consolidation mergers when US Airways was swallowed by American Airlines in 2013. They have merely been continually refined to the point now when the airlines, suddenly enjoying profits, have responded not by lowering fares but by tightening control over the number of seats available and cutting back on flight frequency and destinations.

The reality is that the airlines don’t need to expose themselves to charges of collusion on fares and the operation of a hidden cartel that mutually governs capacity. That’s so 20th century.

These days their key tool is “yield management”—being able to precisely calculate how many seats should be available on any given route at any time of the day or night and adjusting the price hour-by-hour according to demand. This algorithm has become so refined and the market so controlled that each of the major airlines ends up looking at the same numbers on their computer screen. No human intervention is needed. In all but name it is a cartel—but one run entirely by unaccountable robots.

So?

We live in the world’s most vigorously capitalist marketplace. What’s wrong with airlines trying to make a decent profit, for once? And what is the point of them flying empty seats around the skies?

But I come back to my earlier point: How do these airline executives behave when, joy of joys, they find their balance sheets deeply in the black? Like a lot of other corporate minders they think a lot more about their shareholders than their customers. Short-termism rules. Wall Street responds to quarterly earnings, not patient long-term strategy.

A good example is Jet Blue. This airline was a rare example of a successful startup based on a maverick idea: super-chummy cabin staff and generously spaced seating. A new CEO (previously schooled by the stingy bean-counters at British Airways) is undermining that spirit by jamming more seats into the cabin and raising baggage charges, all at the behest of shareholders.

The problem is that the people running airlines in the U.S. have one part of their brain missing, the part that provides the service ethic. As well as fare-gouging they’re space gouging in the cabins. Even with the newest jets like the Dreamliner they are packing more seats into coach than the airplane designers (or nature) intended.

Q1. Read the above article and answer the questions that follow.

a. Why did the investigative reporter James B. Stewart describe US airlines as a classic Oligopoly?

b. What is the meaning of yield management as described in the above article?

c. Why did the writer accuse people running airlines of missing service ethics?