A company is considering the purchase of a large stamping machine that will cost $145,000, plus $6,300 transportation and $11,700 installation charges. It is estimated that, at the end of five years, the market value of the machine will be $48,000. The IRS has established that this machine will fall under a three-year MACRS class life category. The justifications for the machine include $34,000 savings per year in labor and $44,000 savings per year in reduced materials. The before-tax MARR is 20% per year, and the effective income tax rate is 40%. What is the after-tax equivalent annual worth of this investment over the five year period which ends with the sale of the machine?    (Do not enter a dollar sign $ with your answer.)

A firm has a production function Q = KL, where Q is the quantity of output, K is the amount of capital and L is the amount of labor. MPL=K and MPK=L .

a) Suppose that capital is fixed at K=10 in short run. In this case, the marginal product of labor is MPL=10. Does this production function exhibit diminishing marginal returns to labor?

b) Suppose that in the short run, K is fixed at 10. The interest rate is r=4 and the wage is w=1. What is the short run total cost curve?

c) In (b), what are the functions for fixed cost, variable cost, average fixed cost, average variable cost and average cost?

d) In the long-run, capital is also variable. Does this production function exhibit increasing, decreasing or constant returns to scale?

(A-D HAS BEEN ANSWERED)

e) What is the long run cost function? What is average cost in the long run?

A.The long run total cost function is C = 4Q^1/2 and the average cost is AC = 4Q^–1/2.

B.The long run total cost is C = L + 4K and the average cost is AC = (L+4K)/Q

C.The long run total cost function is C = 4L + K and the average cost is AC = 4 + K

D.The long run total cost function is C = 4√Q and the average cost is AC = 4/Q.

f) Does this cost function exhibit increasing or decreasing economies of scale?

A. This cost function exhibits economies of scale

B. This cost function exhibits diseconomies of scale

C. This cost function exhibits neither economies nor diseconomies of scale

D. This production function exhibits economies of scale

A company is considering the purchase of a large stamping machine that will cost $140,000, plus $6,500 transportation and $12,000 installation charges. It is estimated that, at the end of five years, the market value of the machine will be $50,000. The IRS has established that this machine will fall under a three-year MACRS class life category. The justifications for the machine include $35,000 savings per year in labor and $45,000 savings per year in reduced materials. The before-tax MARR is 20% per year, and the effective income tax rate is 40%. What is the after-tax equivalent annual worth of this investment over the five year period which ends with the sale of the machine?    (Do not enter a dollar sign $ with your answer.)

The classical dichotomy is the separation of real and nominal variables. The following questions test your understanding of this distinction.

Megan spends all of her money on magazines and mandarins. In 2012, she earned $18.00 per hour, the price of a magazine was $9.00, and the price of a mandarin was $1.00.

Which of the following give the nominal value of a variable? Check all that apply.

Megan's wage is $18.00 per hour in 2012.

Megan's wage is 2 magazines per hour in 2012.

The price of a mandarin is 0.11 magazines in 2012.

Which of the following give the real value of a variable? Check all that apply.

Megan's wage is 18 mandarins per hour in 2012.

Megan's wage is $18.00 per hour in 2012.

The price of a magazine is $9.00 in 2012.

Suppose that the Fed sharply increases the money supply between 2012 and 2017. In 2017, Megan's wage has risen to $36.00 per hour. The price of a magazine is $18.00 and the price of a mandarin is $2.00.

In 2017, the relative price of a magazine is   .

Between 2012 and 2017, the nominal value of Megan's wage   , and the real value of her wage   .

Monetary neutrality is the proposition that a change in the money supply   nominal variables and   real variables.

Should taxpayer dollars be spent to rehabilitate drug users? If yes, why yes? If no, why no?

One advantage of having a market-clearing price for water in all uses is

Select one:

a. water can be moved to areas where the price is the lowest

b. since prices anticipate the future, possible droughts will be reflected in today's prices encouraging water conservation now before the drought actually hits the supply

c. low income water users will have to pay more than high income users for water even without a drought

d. the rich can get all the water they want regardless of the price

The authors claim that some thinking about water is a myth. Their myth arguments do not include the statement that

Select one:

a. the planet is drying up

b. water is special and is different from other goods

c. there are ways to use ocean water for drinking or irrigation

d. we can save water by using less of it

How do price controls on water impact people?

Select one:

a. it reduces the amount supplied and makes the poor worse off

b. it avoids rationing schemes

c. it makes water less scarce

d. it makes water abundant for all users

What is meant by rent control?

Select one:

a. setting a rental rate below the market rate to make it more affordable

b. letting the rental rate change with market conditions

c. matching supply of housing to the demand for housing

d. paying rent every other month for two years

Which of the following is not an impact of rent control?

Select one:

a. maintenance of rent control housing is first-rate

b. there is a reduction in construction of new rental space

c. residents in rent control apartments prefer to stay in place even if the space is no longer suitable to them

d. the supply of rent control housing deteriorates

CBO data over the past few decades indicate that among the five income groups (low to high)

Select one:

a. all income groups have shown a rise in income over this period

b. low income groups have suffered a decline in income

c. middle income people have the highest rate of income growth over this period

d. low income people have the lowest rate of income

growth historically

With regard to income mobility, studies indicate that over ten years

Select one:

a. typically show that incomes fall with work experience from ages 25 to 55

b. about half of lowest income people rise to higher levels

c. over 90% of high income people stay at that level

d. it is not possible to "boot strap" from poor to richer in the American economy

Women who stop working after having children and eventually return to work,

Select one:

a. are smart enough to take jobs before they leave that allows them to come back to work at higher pay

b. are rewarded with better jobs at higher pay because of their sacrifice

c. often see their duties curtailed and make less money

d. easily return to the work they were doing at higher pay

Data show that women who work make 80 cents on the dollar that males make and this fact is indicative of

Select one:

a. this data is influenced by the fact that men work more hours than women

b. widespread discrimination against women equivalent to $.20 out of a dollar men earn

c. evidence that shows men completely understand the value of women in the worikplace

d. indicates a low level of education women attain so they are not as productive as men

It appears that women dentists make $.74 for every dollar a male dentist makes and it has been reported that women business owners make 50% of what male business owners make. How would an analyst explain these differences?

Select one:

a. Female patients and shoppers prefer male dentists and male-run businesses

b. Women prefer flexible hours so they can live a valued life outside of work

c. Women dentists devote more time to each patient thus reducing their income

d. Men are far more productive than women as studies show

What are the advantages and disadvantages of globalization?

The advantages and disadvantages of globalization can change depending on whether or not they are being evaluated from a social or economic perspective. From an economic standpoint, globalization has provided ample opportunity for a number of American businesses to grow exponentially. Globalization has also had a large impact on how businesses are structured by altering supply chains which has arguably led to greater efficiency as well as lowering the cost of manufacturing and the cost of goods. Globalization has also changed the fortune of workers across the world. The creation and/or reshoring of jobs globally has resulted in lifting a number of individuals out of poverty globally.  In the alternate, the recent pandemic has taught us that globalization is not without its flaws. Due to the shift in global supply chains, you can see how one country can have an outsized role in the production of crucial products such as medical supplies.

Provide a 300 word response to the above topic.

Assess the Impact of Globalisation

1. What are the advantages and disadvantages of each?

Globalization has many advantages and disadvantages to each type of globalization that exists. The most common when globalization is being discussed is economic globalization, which deals with the impact of globalization on countries economy. One advantage to economic globalization is increased competition. Increased competition is great for countries especially those that are newer to the global economy as it helps them to identify themselves in the economy and encourages aggressive growth. A second important advantage is the spread of technology and innovation that businesses are able to share with one another. This is a crucial component to the global economy as technology enables economies to be global in the first place. Without the correct infrastructure, technology and innovation, it is impossible for a country to remain connected to the global economy and other countries. A third advantage to economic globalization is the development of higher standards of living for society in countries that are on the rise for globalization. An example of this would be India where their economy has really taken off in the last 10-15 years. India has really made a mark in the global economy in the information technology sector. As a result, India has become a key player in the global economy, which has significantly helped improve their workforce, society, and products/services that it offers. One disadvantage that economic globalization offers is the contribution to cultural homogeneity or creating a monoculture. The thought is that if countries continue to adapt the same trends and global ideologies, there will be a loss of culture and identity for countries. While having similar views across the world can be a uniting function across different cultures, it can also contribute to the creation of a monoculture; which means less of a unique identity for countries in the global space. A second disadvantage of economic globalization is that large corporations gain more power. Think about a really large company like Google where they are in more than 50 countries throughout the world. Moreover, it’s parent company, Alphabet, is in more than 70 countries throughout the world.

Provide a 300 word response

Discuss with precision what economists mean by the term market failure and discuss some of the major issues that our democracy faces. In your opinion, what could be done in (if you think changes need to be made) in order to make a government that is more responsive to the needs of the people?