Let's consider an economy where all firms are favouring remote work to favour physical distancing and avoid the spread of a virus. To achieve these goals all firms receive a subsidy to equip their workers with a laptop. Consider that the market for laptops is in perfect competition and initially at the equilibrium. Explain the impact of the pandemic on the supply, demand, equilibrium on market of computers. Give a graphical representation.
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- At some colleges and universities, economicsprofessors receive higher salaries than professors insome other fields.a. Why might this be true?b. Some other colleges and universities have a policyof paying equal salaries to professors in all fields.At some of these schools, economics professorshave lighter teaching loads than professors insome other fields. What role do the differences inteaching loads play?Graphically demonstrate how the following economic events influence (ceteris paribus) the relevantde-mandfunction. Label your axes, and specify the market you are discussing. (a) Technological development has lowered the price of natural gas-powered electricity; What effect doesthis have on the market for coal-fired electricity? (b) A strong growing season for pomegranates leads to lower prices of the fruit.Explain whether each of the following eventsincreases, decreases, or has no effect on long-runaggregate supply.a. The United States experiences a wave ofimmigration.b. Congress raises the minimum wage to$15 per hour.c. Intel invents a new and more powerfulcomputer chip.d. A severe hurricane damages factories along theEast Coast.
- Nimbus, Inc., makes brooms and then sells themdoor-to-door. Here is the relationship between thenumber of workers and Nimbus’s output during agiven day:Workers OutputMarginalProductTotalCostAverageTotalCostMarginalCost0 0 ____ ________ ____1 20 ____ ________ ____2 50 ____ ________ ____3 90 ____ ________ ____4 120 ____ ________ ____5 140 ____ ________ ____6 150 ____ ________ ____7 155 ____ ____a. Fill in the column of marginal products. Whatpattern do you see? How might you explain it?b. A worker costs $100 a day, and the firm has fixedcosts of $200. Use this information to fill in thecolumn for total cost.c. Fill in the column for average total cost. (Recallthat ATC T 5 C Q/ .) What pattern do you see?d. Now fill in the column for marginal cost.(Recall that MC TC 5 D ∆ / Q.) What patterndo you see?e. Compare the column for marginal productwith the column for marginal cost. Explain therelationship.f. Compare the column for average total costwith the column for marginal cost. Explain…Suppose that the president proposes a new lawaimed at reducing healthcare costs: All Americans arerequired to eat one apple daily.a. How would this apple-a-day law affect thedemand and equilibrium price of apples?b. How would the law affect the marginal productand the value of the marginal product of applepickers?c. How would the law affect the demand andequilibrium wage for apple pickers?Shows in table how the average costs of production for semiconductors(the“chips”incomputermemories) change as the quantity of semiconductors built at that factory increases. a. Based on these data, sketch a curve with quantity produced on the horizontal axis and average cost of production on the vertical axis. How does the curve illustrate economies of scale? b. If the equilibrium quantity of semiconductors demanded is 90,000, can this economy take full advantage of economies of scale? What about if quantity demanded is 70,000 semiconductors? 50,000 semiconductors? 30,000 semiconductors? c. Explain how international trade could make it possible for even a small economy to take full advantage of economies of scale, while also benefiting from competition and the variety offered by several producers.
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- Construct the Two-commodity market model and find out th set of equilibrium prices mathematically?You just got a job in Washington, D.C. You moveinto an apartment with some acquaintances. All yourroommates, however, are slackers and do not clean upafter themselves. You, on the other hand, can clean fasterthan each of them. You determine that you are 70%faster at dishes and 10% faster with vacuuming. All ofthese tasks have to be done daily. Which jobs shouldyou assign to your roommates to get the most free timeoverall? Assume you have the same number of hours todevote to cleaning. Now, since you are faster, you seemto get done quicker than your roommate. What sortsof problems may this create? Can you imagine a traderelated analogy to this problem?Suppose the U.S. economy began to grow more rapidly than other counties in the world. What would be the likely impact on U.S. financial markets as part of the global economy?