MBA 525 Exam 1 Question set – answers to short questions 1. Assume that the price of pizza is $2.00 per slice. The marginal cost of the 3rd slice of pizza is: $2.00 2. Which of the following best describes the concept of opportunity cost for a particular decision? The value of the next best (but not chosen) alternative. 3. If the quantity demanded of tea increases by 10% when the price of tea decreases by 2%‚ the price elasticity of demand for tea is: +10 / -2 = - 5.00 4. An increase
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universal parks in Barbados has the potential to pay significant dividends in the years to come. Furthermore an investment of $100 million into tourism could cause a multiplier effect strengthening the overall economy further as long as the marginal propensity to consume is great than it is to save. Barbados GDP growth 2000 - 2009 Source: http://www.indexmundi.com/g/g.aspx?c=bb&v=65 Barbados Rate of Inflation 2000 - 2009 Uncertainty about Barbados’s future inflation rate may discourage investment
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and potential GDP in that country. A5-3. In Saudi Arabia‚ gross domestic product (GDP) is less than gross national product (GNP). This means that the nation produces domestically more than it is able to consume domestically. A5-4. If aggregate household saving is negative‚ the marginal propensity to save from disposable income must be negative. A5-5. If desired aggregate expenditure is greater than actual national output‚ national output will increase. A5-6. If the domestic price level decreases
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pizza for $12. If you order a second pizza‚ however‚ the pizzeria charges a price of only $5 for the additional pizza. Explain how an understanding of marginal utility helps to explain the pizzeria’s pricing strategy. 20-1-A. The pricing method that the pizzeria is using shows they understand how marginal utility works‚ specifically diminishing marginal utility. After hitting the level of satisfaction from the first pizza‚ a second pizza will not be quite as rewarding. Getting an additional pizza at
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Diagram 1 shows negative externalities of consumption E-cigarettes are a demerit good (goods that will be over-provided by the market and‚ because of this‚ they will be over consumed and that the government thinks are bad both for people who consume them and for society as a whole‚ and therefore government would like to see them consumed to a lesser degree‚ or not at all (Blink and Dorton 141)). Cigarettes are a product that adversely affects third parties. Negative externalities of consumption
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1.0 Introduction According International Labour Organization‚ Minimum wage defines as the lowest basic wage guaranteed by the law as an attempt to put a floor under the wages of a particular subgroup of working population. The progress of minimum wages policy was started after the National Wages Consultative Council Act gazette on 15 September 2011. This provision replaced the Salary Determination Council Act 1974 which is seen not effective to protect the workers welfare in general. The provision
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agriculture are the main economic activities. Cattle kept by the ranchers have been found to destroy the crop thus causing losses in terms of reduced food output. The table below shows‚ for each of cow/bull output‚ the Marginal cost (MC)‚ the marginal benefit (MB) to rancher‚ and the Marginal damage (MD) done to crops: Output MC MB MD 1 400 1600 400 2 800 1600 800 3 1200 1600 900 4 1600 1600 1000 5 3200 1600 1200 6 6400 1600 1400 What will be the herd size
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satisfactuin using a measure of cardinal utility Marginal Utility- the added utility derived from increasing consumption of a particular product by one unit holding the consumption of all other goods service constant. Mux= Most marginal utility for each dollar spending. Lecture 2 is not on the website yet This concept of analyzing goals at the margin something we will use throughout this course. Added satisfaction= marginal utility As the price increase the quantity demanded
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Psychology 100 Energy drinks mixed with alcohol: the interactive effects on risk-taking behavior‚ alcohol consumption and related negative consequences Abstract The aim of this study was to explore the relationship between risk-taking propensity; AmED use and the effects these variables had overall alcohol consumption and the experience of related negative consequences. Participants were 172 university students from the psychology faculty of an Australian university. Data was collected
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APPLIED MACROECONOMICS W.J.M. Heijman CONTENTS Preface CHAPTER 1: INTRODUCTION 1.1 Background 1.2 Targets of economic policy 1.3 Instruments of economic policy 1.4 Tinbergen’s view on economic policy 1.5 The value of economic activity Questions and exercises Appendix 1.1 1 1 2 5 10 13 16 17 CHAPTER 2: BASIC MACROECONOMIC MODELS 2.1 The models 2.2 Closed economy‚ fixed prices 2.3 Closed economy‚ fixed prices‚ government budget 2.4 International trade‚ fixed prices
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