3. Assume you are a senior manager of a cell phone provider such as TELUS, Rogers or Bell.

1. How might your (cell phone provider) costs of production be affected in the short-run and long-run? (approx. 230 words)

5a. Suppose that any given individual firm in this same perfectly competitive industry has the following:
?? = 0.6?3 − 1.9?2 + 5? + 30

??? = 0.6?2 − 1.9? + 5 + 30/?

?? = 1.8?2 − 3.8? + 5

Also, assume the market price is P* = 10.

Find the quantity that the individual firm would produce at this price. Round your answer to the nearest
whole number. Show work. You will have to use the quadratic formula.

5b Using your rounded quantity, what is the short-run profit or loss earned by a typical firm in this industry
at this market price? Don’t round your profit answer. Show work

6. Draw a graph showing this single firm (the ATC and MC functions) and its profit or loss. To do this, you
will also have to show the price, quantity chosen by the firm, and the average costs of production at that
output level. Label everything clearly.

Draw an AS-AD graph showing a recessionary gap labeling carefully. Show how central bank could act to close the gap. Show how this would be accomplished with open market operations on a Supply and Demand for Reserves graphs, starting from a point where there is no discount lending.

Why are agricultural prices highly variable? Does elasticity matter? Does a long term view differ from the short term? Describe elasticity and the typical assumptions made about the elasticity of agricultural production and food demand.

pls do not hand write !

Use the following information for a Taylor rule. The equilibrium real federal funds rate is 2%, the inflation target is 2% and the (real) output growth target is 3%.

a) If actual inflation is 3% and actual output growth is 4%, find the federal funds rate recommended by the Taylor rule.

b)   If actual inflation is 1% and actual output growth is 1%, find the federal funds rate recommended by the Taylor rule. How do these numbers compare with the actual values today?

Suppose that the Phillips curve is given by: ?? = ?? ? + ? − ??? where ?? is the inflation rate, ?? ? is the expected inflation, ?? is the rate of unemployment and, a and b are two positive parameters. Before the COVID-19 crisis, no wage contract was indexed to the inflation. After the crisis a fraction ? > 0 of wage contracts are indexed to inflation.

a. Derive the new equation for the Phillips curve after the crisis.

b. Derive an algebraic expression for the natural rate of unemployment after the crisis. It is believed that the Phillips curve for Canada will be: ?? − ??−1 = 3.2% − 0.4?? 3

c. Plot this curve on a graph with ?? on x-axis and ?? − ??−1 on y-axis.

d. Assume that ? = 0.5, find the numerical values of parameters a and b as implied by the above estimated Phillips curve.

e. What will be the natural rate of unemployment?

The post-war era was rough on the movie business. What schemes and tools are the theatres using today? Are they effective?

Explain why win-win situation is better than trade is a zero-sum game.

Explain what happens to a commercial bank’s reserves and checkable deposits after it has made a loan.

1. Romer (1990) divided economic goods into objects and ideas.
   1. How are ideas and objects different?
   2. Why is the distinction important for economic growth?
   3. Can you explain it in terms of conventional microeconomic theory?
   4. Can you think of two examples of ideas important in economic activity other than the ones we have discussed in class?

Case Study on Walmart using IT

A major reason for Wal-Mart’s success over the year was its constant emphasis on installing the most modern IT systems, which helped it achieve better economy of scale, distribution efficiency and pass on the benefits of the same to the customers. By offering low price to customers, Wal-Mart was able to generate more sales and minimize the promotional expenditure of the company.

By using IT, Wal-Mart was able to establish proper communication links with its suppliers, distribution centers and individual stores. Wal-Mart employed Electronic Data Interchange (EDI) that linked the computers at the stores, its distribution center and even key suppliers like P&G. In order to make its distribution system more efficient and to establish stronger links with its suppliers, Wal-Mart installed the satellite communication system at an estimated cost of $700 million. The system connected all the operating units of company and the general office with two way voice, data and video communication. Wal-Mart could keep a constant track of the movement of inventory from the manufacturing to the distribution centers and finally, to the stores. Its thousands of suppliers could obtain daily sales reports. The system also helped Wal-Mart to automate the inventory replenishment process.

Wal-Mart also used IT to improve its supply chain efficiency. Wal-Mart installed “Retail link” system that connected EDI networks to an extranet accessed and used by Wal-Mart’s business customers and its thousands of suppliers to obtain data relating to sales and stock levels at every Wal-Mart stores. The data enabled Wal-Mart’s suppliers to analyze market trends, undertake the necessary stock replenishment and plan out their production schedules to cater to Wal-Mart’s needs.

Apart from investing in building advance IT system Wal-Mart simultaneously built massive database of point of sales data at each of its stores. Using data mining Wal-Mart was able to determine the needs and preferences of its customers up to an individual store level and customize its merchandise according.

Q1. What are the benefits Wal-Mart obtained by using modern IT systems for its business and customers?

Q2. Briefly explain the benefit of using EDI over manual systems. Also explain all the benefits discussed in this case that is obtained by Wal-Mart by using EDI and satellites.

Q3. How can Wal-Mart customize merchandise for each store?                           

Q4. How Retail-link system helped the suppliers of Wal-Mart?   

16. Which one do you agree, “trade is a zero-sum game” or “trade is a win-win situation”? Explain your answer.

2. In a model of dynamic increasing returns, illustrate an alternate scenario to what we discussed in class and briefly explain using words. In this scenario, France protects its cotton industry with a temporary blockade, but after the blockade ends the protection is not enough for France to retain an advantage in cotton production, and once UK cotton is no longer blockaded, that the UK will recover its initial advantage. Be sure to draw and label any necessary learning curves (UK and France), and any relevant points on the curves.

Consider a model of increasing returns to scale with symmetric firms.

a) Algebraically show what the equilibrium number of firms, price, and average cost must be, in terms of their equations. You may start from the equations relating price to the number of firms p=c+1/bn, and average cost to the number of firms AC=Fn/S+c.

B) with the aid of a diagram, illustrate what happens to the equilibrium number of firms, prices, and average cost when one country opens up to trade (integrates its market) with another country. Explain whether consumers in the original country are better off, and specifically how.

C) Assuming we start off in pre-trade equilibrium, what happens in the model when the fixed cost F decreases, in terms of number of firms, prices, and average cost? You can answer this question graphically or with algebra. Would you conclude that consumers are better off, worse off, or uncertain?