1) Given the following equations:

   QD = 5,000 + 0.5 I + 0.2 A - 100P, and QS = -5000 + 100P

where Q is the quantity per year, P is price, I is income per household, and A is advertising expenditure.

  a.   If A = $10,000 and I = $25,000, what is the demand curve?

b.   Given the demand curve in part a., what is equilibrium price and quantity?

c.   If consumer incomes increase to $30,000, what will be the impact on equilibrium price and quantity?

2) Industry supply and demand are given by QD = 1000 - 2P and QS = 3P.

a.   What is the equilibrium price and quantity?

b.   At a price of $100, will there be a shortage or a surplus, and how large will it be?

c.   At a price of $300, will there be a shortage or a surplus, and how large will it be?

1. Suppose that Lexi preferences are given by the utility function u(x1; x2) = x₁²x₂, where x₁ denotes bottles of juice, and x₂ denotes the number of meat plates. A meat dish costs $15 on average, and bottle of juice is $3. You are told that at these prices Lexi can afford 10 meat plates and 40 bottles of juice per month.

i) Derive Lexi optimal consumption bundle.
ii) Which of the following two options would Lexi prefer? Show work.

Option (1): Additional $30 that Lexi can spend only on meat.

Option (2): $3 off of each meat plate ordered.

Determine the net present worth (NPW) of the cash flows given in table below for an investment opportunity being presented to a company. MARR =10%. Year 0 1-10 11-15 16-25 26-30 Cash Flow -$100K 10K 20K -5K 30K

Suppose the optimization problem is to minimize the cost of production c = 3 x + 4 y subject to the constraint 2xy =337.5. Here the cost-minimizing amount of x is ?? , and y is ?? .

The Lagrange multiplier is ?? .

The second principal minor of Bordered Hessian is ?? .

The bordered Hessian matrix is??

What are some of the actions taken by Ken Lay as the CEO of Enron and what were the ethical issues?

Consider the consumption theories

a) Explain the Keynes’ consumption puzzle?

b) How does Modigliani’s consumption theory resolve the puzzle?

c) How does Friedman’s consumption theory resolve the puzzle?

At its simplest level, Keynesian macroeconomics suggests there may be a role for government policy when it comes to the success of the macroeconomy. With this in mind, President Donald Trump passed the “Tax Cuts and Jobs Act of 2017” (TCJA) which went essentially into effect on January 1, 2018. A large part of the long run impact of this policy change depends on the multiplier which in turn depends on the marginal propensity to consume (MPC). As it turns out, you have the most recent and up to date estimates of the MPC and so Donald Trump has sent an aide to interview you about this and your thoughts on the policy change as well.

1. Youre an econometric expert when it comes to the MPC but we have only spent a small time talking about the "TCJA". Explain what it is and what the key provisions are (despite popular belief, Wikipedia seems like a fine source for this).

Markets work well for some goods, but poorly for others. According to the textbook, for which of the following goods or services would markets be expected to work poorly?
A. clean air
B. clean water
C. clean amusement parks
D. Markets would work poorly for all three of the goods or services listed above.
E. Markets would work poorly for both clean air and clean water, but they would work well for clean amusement parks.

The Tragedy of the Commons will be evident when a growing number of sheep grazing on the town commons leads to a destruction of the grazing resource. As a result,
(x) externality could be eliminated if all of the sheep owners received a subsidy payment from government.
(y) the town could auction off a limited number of sheep-grazing permits to correct this problem.
(z) the town could assign land property rights to individual owners to correct this problem.
A. (x), (y) and (z)
B. (x) and (y) only
C. (x) and (z) only
D. (y) and (z) only
E. (y) only
15. Which of the following statements is (are) correct?
(x) If general knowledge is not excludable then it is quite likely that profit maximizing firms in private markets would choose to not supply general knowledge to society.
(y) As with many public goods, determining the appropriate level of government support for the production of general knowledge is difficult because benefits are hard to measure
(z) If technological knowledge is excludable and general knowledge is not excludable, then it is likely that technological knowledge is a “club good” (natural monopoly good) and general knowledge is a public good
A. (x), (y) and (z)
B. (x) and (y) only
C. (x) and (z) only
D. (y) and (z) only
E. (z) only

What current external (foreign) conditions are relevant in deciding the monetary policy instrument for UK (specifically how global or external conditions impact UK)? Provide atleast 5 points

1. How do you think John Stuart Mill would view the most recent world-wide financial crisis? In terms of: What are the factors leading to it, what factors should be in place to prevent it happening again, and what should have been done to correct it?  

How was the governance of the Federal Reserve constructed in order to avoid potential abuse of power and balanced representation? In what ways has the Federal Reserve system worked? In what ways has the Federal Reserve system not worked?

PART; What would you expect economist to predict would be the impact on your life relative to the solar power industry if there were no off shore drilling and no importation of foreign oil?(Hint: The combination of these two changes would reduce the supply of oil in the United States by about 70%)

PART 2: Digging Deeper When disaster strikes, you can count on two things: Looting and Price Gouging. Consider that a major hurricane has struck. Power is out, chaos has ensued. Explain what might happen in terms of the supply of essential goods, such as food and gas. Then discuss how price gouging might result. Compare and contrast price gouging with looting.