What is the key macroeconomic issue of the short run and what is the key macroeconomic issue of the long run?
What will be an ideal response?
In the short run, macroeconomics focuses on the business cycle, and in the long run, macroeconomics focuses on long-run economic growth.
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Graph the MSB and MSC functions on the same diagram. Show the regionally-based set of standards (ALA and AREMAINDER) that should be recommended to achieve allocative efficiency in each region. Find the numerical value of each standard.
Los Angeles County has the worst urban air quality across all major metropolitan areas in the United States. Automobile emissions contribute significantly to this problem. Assume the California Air Resources Board is consideringwhether to set a uniform emission standard or a regionally-based emission standard, where one standard is set for Los Angeles County and another for the rest of the state. Marginal social benefits (MSB) and marginal social costs (MSC) for the two regions have been estimated as follows: MSBabatement in LA County = 500 ?0.75A MSBabatement in the rest of California = 150 ? 0.25A MSCabatementin all of California = 0.5A, where A is the level of abatement of automobile emissions, and MSB and MSC are in millions of dollars.
An increase in income shifts indifference curves outward.
Answer the following statement true (T) or false (F)
Suppose Jordan and Lee are trying to decide what to do on a Friday. Jordan would prefer to see a comedy while Lee would prefer to see a documentary. One documentary and one comedy are showing at the local cinema. The payoffs they receive from seeing the films either together or separately are shown in the payoff matrix below. Both Jordan and Lee know the information contained in the payoff matrix. They purchase their tickets simultaneously, ignorant of the other's choice.
Suppose a timing element is added to the game, and that Jordan buys a ticket first. Then, after seeing Jordon's choice, Lee buys a ticket. What will be the equilibrium outcome?
A. Jordan will buy a ticket to the documentary and Lee will buy a ticket to the comedy. B. Jordan will buy a ticket to the comedy and Lee will buy a ticket to the documentary. C. Both Jordan and Lee will buy a ticket to the documentary D. Both Jordan and Lee will buy a ticket to the comedy.
Suppose the market for grass seed can be expressed as Demand: QD = 100 - 2p Supply: QS = 3p If government imposes a 10% ad valorem tax to be collected from sellers, what is the price consumers will pay? How much tax revenue is collected?
What will be an ideal response?