Barriers to entry: In theories of competition in economics‚ barriers to entry are the obstacles and hindrances that make it difficult for a company to enter a given market or industry. The most common barriers to entry include government regulation and economies of scale‚ but nowadays it is increasing for entry barriers to be viewed as a cost. Stigler defined barriers to entry as “A cost of producing which must be borne by a firm which seeks to enter an industry but is not borne by firms already
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CHAPTER 12 Fiscal Policy A. Short-Answer‚ Essays‚ and Problems 1. Give a brief definition of fiscal policy? What are its economic goals? 2. What is the Council of Economic Advisers? 3. “The Employment Act of 1946 is no more than a vague and ill-defined commitment by the Federal government to assist in the achievement of full employment.” Do you agree? Explain. 4. Explain the effect of a discretionary cut in taxes of $40 billion on the economy when the economy’s marginal propensity to consume
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CHAPTER 1 1. Internal expansion involves a normal increase in business resulting from increased demand for products and services‚ achieved without acquisition of preexisting firms. Some companies expand internally by undertaking new product research to expand their total market‚ or by attempting to obtain a greater share of a given market through advertising and other promotional activities. Marketing can also be expanded into new geographical areas. External expansion is the bringing together
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The table given below represents the marginal valuation of a beekeeper (collecting honey) and an orchard farmer (producing mangoes). The beekeeper’s opportunity cost reflects the loss in honey collection resulting from the usage of the same orchard again and again. Table 1 Days used Total honey value ($) Marginal honey value ($) Beekeeper’s opportunity cost ($) Total value of mangoes ($) Marginal value of mangoes ($) 1 18 18 2 10 10 2 23 6 2 17 7 3 27 5 2 23 6 4 30 3 2 28 5 5 32 2 2 32 4
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Student’s Manual Essential Mathematics for Economic Analysis 3 edition rd Knut Sydsæter Arne Strøm Peter Hammond For further supporting resources please visit: www.pearsoned.co.uk/sydsaeter Preface This student’s solutions manual accompanies Essential Mathematics for Economic Analysis (3rd edition‚ FT SM ⊃ Prentice Hall‚ 2008). Its main purpose is to provide more detailed solutions to the problems marked ⊂ in the text. This Manual should be used in conjunction with the answers in
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1) Discuss the owner-manager conflict within the firm. Provide two real world manifestations of the conflict. Owner-manager conflicts finds it basis on the self-interested behaviors of managers‚ owners and shareholders. Firm managers may have personal goals that conflict with the owner’s goals of maximizing shareholder wealth. Potential conflicts occur when managers seek to maximize their own utility at the expense of the firm’s shareholders. Conflict between owners and managers typically arise
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Exam Name___________________________________ MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) Equilibrium in the goods market occurs where A) aggregate expenditure equals autonomous consumption. B) real GDP equals nominal GDP. C) aggregate expenditure equals real GDP. D) autonomous consumption equals induced consumption. 2) Other things equal‚ if planned investment spending is greater than actual investment spending‚ then aggregate expenditure
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unlikely that we can grow our own food‚ sew our own clothes or build our house‚ it would be better if we would __specialize___ in what we do best and __exchange_ for those needs that others do better 3 The term _product market___ is a place where and economic exchange occurs between buyers and sellers. 4 There is a‚ an (inverse‚ direct)_inverse__ relationship between the price of a good and the quantity we will purchase. This is the law of __demand______ 5 The demand curve slopes (upward‚ downward)
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ANSWER SCHEME ECO551/553 APRIL 2010 QUESTION 1 a) A barter trade system is a system whereby people exchange goods for other goods. ( with example) b) There are many problems facing the barter trade. Three of these problems are: i) Double coincidence of wants ii) Rate of exchange iii) Divisibility ( with explanation) (b) The four functions of money are as follows: i) Medium of exchange ii) Unit of account iii) Store of value iv) Standard for deferred payment
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Brooke Foster Macroeconomics PG 71 & 72: Review question #5 & #8‚ problems #1‚3‚ &7 Review #5. Suppose that in the market for computer memory chips‚ the equilibrium price is $50 per chip. If the current price is $55 per chip‚ then there will be (B.) a surplus of memory chips. Review #8. Suppose that the government establishes a price ceiling of $3.70 for wheat. What might prompt the government to establish this price ceiling? Explain carefully the main effects. Demonstrate answer graphically
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