...CHAPTER 9 READING OUTLINE 1. Distinguish between explicit and implicit costs. Explicit costs are payments the firm must make for inputs to non-owners of the firm to attract them away from other employment, for example, wages and salaries to its employees. Implicit costs are non-expenditure costs that occur through the use of self-owned, self-employed resources, for example, the salary the owner of a firm forgoes by operating his or her own firm and not working for someone else. 2. Explain an accounting profit and an economic profit. Accounting profit equals sales revenue minus explicit costs, such as material, the wages of employees, etc… and Economic profit equals the accounting profit minus the additional implicit costs of the business. This includes entrepreneurial ability, forgone interest, forgone labor income, etc… 3. Explain how the short run differs from the long run. In the short run, the industry is composed of a specific number of firms, each with a plant size that is fixed and unalterable in the short run. Firms may shut down in the sense that they can produce zero units of output in the short run, but they do not have sufficient time to liquidate their assets and go out of business. But, in the long run the firms already in an industry have sufficient time to either expand or contract their capacities. More importantly, the number of firms in the industry may either increase or decrease as new firms enter or existing firms leave. 4....
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...1. i. Principle one has to do with allocating time because it has to do with Tradeoffs. Someone could decide to sleep longer, but then they wouldn’t have had as much time to study. This is also called opportunity cost, the opportunity cost is the price of the thing that you are giving up. ii. a. Scarcity: Scarcity is when there is a shortage of a good or a want. b. Efficiency: Is how well an item is produced. This is best with little waste or expense. c. Equality: distributing economic prosperity equally among everyone. d. Opportunity Cost: something that must be given up to get something else. e. Marginal Change: a small adjustment to a plan. f. Externality: the impact of one person’s actions on someone else. g. Productivity: The amount of goods or services produced. h. Incentives: Something that controls how a person will act. i. Property Rights: The ability of someone to own scarce items. 2. i. Inflation is the increase in the prices in the economy. The cause of inflation is the Government prints too much money, therefore there is a lot more money out there so prices rise. ii. The short-term trade-off between inflation and unemployment is the government spends more money (stimulus) which increases the demand for goods and services. The higher demand makes businesses raise their prices, but it also makes them hire more workers to help with the demand. The more people that are hired, the lower unemployment percentages. ...
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...ECON 1002 Tutorial 4 Assignment Click Link Below To Buy: http://hwcampus.com/shop/econ-1002-tutorial-4-assignment/ ECON 1002 Tutorial 4 Assignment You are given data on food expenditure, income and demographic characteristics of 150 married couples, where the husband is a manual worker and is aged 30-50. All survey interviews take place in the same month. You decide to estimate an Engel curve and regress the ratio of food expenditure to income (wfoy) on the logarithm of net current income (ncy), the number of children aged 6-10 (kids2), the number of children aged 11-17 (kids3) and an indicator for London (london = 1 if the couple lives in Greater London, and 0 otherwise). Your estimates are: OLS Estimation, Dependent variable is wfoy, 150 observations Variable Coefficient Standard error constant 0.877 0.065 ncy -0.155 0.014 kids2 0.026 0.006 kids3 0.138 0.032 london 0.047 0.018 R2 0.496 Mean of wfoy 0.189 Mean of ncy 4.473 (a) On the basis of the above estimates, establish if food is a necessity or a luxury. (b) Establish the statistical significance of the coefficient on london. (c) Further, compute the income elasticity for a hypothetical couple living outside London, with mean log income and no children. (d) It has been suggested that share of budget spent on food is a good indicator of household living standard. Households spending a lower share of their budget on food are to be regarded as better off. If number of young children in a household were...
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...ECON 1002 Tutorial 4 Assignment Click Link Below To Buy: http://hwcampus.com/shop/econ-1002-tutorial-4-assignment/ ECON 1002 Tutorial 4 Assignment You are given data on food expenditure, income and demographic characteristics of 150 married couples, where the husband is a manual worker and is aged 30-50. All survey interviews take place in the same month. You decide to estimate an Engel curve and regress the ratio of food expenditure to income (wfoy) on the logarithm of net current income (ncy), the number of children aged 6-10 (kids2), the number of children aged 11-17 (kids3) and an indicator for London (london = 1 if the couple lives in Greater London, and 0 otherwise). Your estimates are: OLS Estimation, Dependent variable is wfoy, 150 observations Variable Coefficient Standard error constant 0.877 0.065 ncy -0.155 0.014 kids2 0.026 0.006 kids3 0.138 0.032 london 0.047 0.018 R2 0.496 Mean of wfoy 0.189 Mean of ncy 4.473 (a) On the basis of the above estimates, establish if food is a necessity or a luxury. (b) Establish the statistical significance of the coefficient on london. (c) Further, compute the income elasticity for a hypothetical couple living outside London, with mean log income and no children. (d) It has been suggested that share of budget spent on food is a good indicator of household living standard. Households spending a lower share of their budget on food are to be regarded as better off. If number of young children in a household were...
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...Econ 200 Principles of Macroeconomics - Homework #2 (Total: 20 Points + 5 Extra Credit Points) Please complete on separate sheets of paper. Due March 11, 2014. ■ I. REVIEW QUESTIONS 1. (5 points) Tony is an attorney at a law firm, and his girlfriend Ursula is a landscaper/gardener. They met while Ursula was providing her landscaping services to Tony. Thanks to her, Tony has a wonderful garden, filled with beautiful blooming flowers year-round. After dating for some time, they decided to tie the knot. Will this event − Tony marrying his landscaper/gardener − lead to a rise, fall or no change in Gross Domestic Product? Explain your answer why or why not. 2. (10 points) Are each of the following included or excluded in this year’s GDP? Explain your reasons for including or excluding each item. If it is included, explain which component of GDP do the different items belong. a. Social security payments received by a retired factory worker. b. Payments for services performed by a dentist. c. The money received by Susan when she sells her economics textbook to a book buyer. d. The monthly allowance a college student receives from home, which is then spent on purchasing textbooks. e. Rent received on a two-bedroom apartment. f. The money received by Luke when he resells his current-year-model Honda automobile to Jim. g. The sale of a college textbook. h. A $2 billion increase in business inventories. i. The purchase of 100 shares of General Motors common stock. j. A resident of Nevada...
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...Does your career plan include a world of lifelong success? Program of Professional Studies THE CERTIFIED GENERAL ACCOUNTANTS ASSOCIATION OF BRITISH COLUMBIA We see more than numbers. Choose a career that places you on the path to lifelong success. It’s all about opportunity. Accounting professionals can work in any sector, anywhere in the world. And when you choose CGA, you’ll gain the leadership, problem-solving and technical skills that are sought after by organizations in the private, public and not-for-profit sectors. The CGA Program of Professional Studies gives you the tools to succeed in business, no matter where your career takes you. You’ll enter the workforce with the applied knowledge and demonstrated expertise that employers want, including specialized technical knowledge, sectorspecific competencies, problem-solving skills and the ethical integrity to lead. CGA’s competency-based curriculum is simply your best way to prepare for a rewarding career in financial management. Flexible study options and the freedom to choose the career you want CGA is all about choice. You choose the professional-studies path and real-world experience that best match your career goals and interests. We give you the skills and freedom to work in any type of organization, in any industry, at any level of management. With a CGA designation, your opportunities—both professional and personal, at home and around the world—are limitless. Take your place as a highly respected...
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...ACC 576 Final Exam Guide For more course tutorials visit www.tutorialrank.com ACC 576 Final Exam Study Question 1 (IFTC-0112) Controls in the information technology area are classified into the preventive, detective, and corrective categories. Which of the following is a preventive control? Question 2 (IFTC-0082) An organization relied heavily on e-commerce for its transactions. Evidence of the organization’s security awareness manual would be an example of which of the following types of controls? Question 3 (IFTC-0067) Which of the following types of control plans is particular to a specific process or subsystem, rather than related to the timing of its occurrence? Question 4 (CGIC-0032) Which of the following is true about the Sarbanes-Oxley requirements regarding the audit committee financial expert? Question 5 (CGIC-0026) Which of the following is not a component of COSO’s enterprise risk management framework? Question 6 (CGIC-0010) Which of the following is not required by the Sarbanes-Oxley Act of 2002? Question 7 (CGIC-0025) Which of the following is not an advantage of the employment of an enterprise risk management (ERM) system? Question 8 (CGIC-0008) A financial statement audit performed under the requirements of the Sarbanes-Oxley Act of 2002 must include an examination and report upon Question 9 (CGIC-0024) An important benefit of an enterprise risk management system is Question 10 (CGIC-0023) Which of the following...
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...Fall-14 Econ-2 Sec. #0720 Homework Assignment - 2 Interest Rate and Monetary Policy LAHC Student Name (print): Assume that the following data characterize the hypothetical economy of Greatcy: money supply = $210 billion; quantity of money demanded for transactions = $150 billion; quantity of money demanded as an asset = $10 billion at 12 percent interest, increasing by $10 billion for each 2-percentage-point fall in the interest rate. 1. Present the data graphically using the space provided on the left. Properly label the graph. 2. What is the equilibrium interest rate in Greatcy? 3. At the equilibrium interest rate, what are the quantity of money supplied, the total quantity of money demanded, the amount of money demanded for transactions, and the amount of money demanded as an asset in Greatcy? Quantity of money (M) supplied = $_______ Total quantity of money (M) demanded = $______ Amount of M demanded for transactions = $______ Amount of M demanded as an asset = $______ Refer to the table for Roolanda: Money Supply $500 500 500 500 500 Money Demand $800 700 600 500 400 Interest Rate 2% 3% 4% 5% 6% Investment at Interest $80 70 60 50 40 Potential Real GDP $350 350 350 350 350 Actual Real GDP at Interest $390 370 350 330 310 4. Answer the following questions: What is the equilibrium interest rate in Roolanda? __________________ What is the level of investment at the equilibrium interest rate? ______________ Is there either a recessionary output gap (negative...
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...College of Economics and Management 85 COLLEGE OF ECONOMICS AND MANAGEMENT Libornio S. Cabanilla, Dean Jose V. Camacho, Jr., Associate Dean Agnes T. Banzon, College Secretary Reynaldo L. Tan, Chair, Dept. of Agribusiness Management Cesar B. Quicoy, Chair, Dept. of Agricultural Economics Amelia L. Bello, Chair, Dept. of Economics The College of Economics and Management (CEM) was formally created in the 996th UP-BOR meeting, February 1987. However, the College traces its roots to the Institute of Agricultural Development and Administration (IADA)which was established in 1975, with three departments – Agricultural Economics (DAE), Economics (DE), and Management (DM), and was elevated to the College of Economics and Management from the merger of IADA with the Agricultural Credit and Cooperative Studies and the Agrarian Reform Institute in 1978. At present, CEM is composed of three departments – the Department of Agricultural Economics, the Department of Economics and the Department of Agribusiness Management. The college sees itself as a center of excellence in undergraduate and graduate instruction, research and extension in economics, agricultural and applied economics, and agribusiness management in Asia. It envisions to be an institution of higher learning that can serve as an active catalyst for economic and social transformation. Its two-fold mission is to produce graduates and future leaders with strong training in economics, agricultural and applied economics, and in agribusiness...
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...PROGRAM OF STUDY Liberal Arts and Sciences: Social Science Associate in Arts The Liberal Arts and Sciences major is designed for students planning to transfer to either the California State University or University of California. To earn the Associate in Arts degree with a Liberal Arts and Sciences major, students must complete either the Intersegmental General Education Transfer Curriculum (IGETC) UC or CSU option or the CSU General Education Certification pattern and one of the three areas of emphasis. The areas of emphasis are: Mathematics and Science, Social and Behavioral Sciences or Humanities. The area of emphasis requires a minimum of 18 units with a grade of "C" or better in all courses in the area of emphasis. The courses identified for each area of emphasis fulfill major preparation requirements as demonstrated through ASSIST articulation. A minimum of six units must be within a single discipline and in the case of the Mathematics and Science area of emphasis at least one mathematics course must be completed. Select courses based on ASSIST data for major preparation articulation with selected transfer institutions. Consult a counselor for specific information regarding the intended major at the college the student is choosing. Courses used to complete a student's area of emphasis can double count for general education just as they may for any other major. Although the associate degree recognizes the completion of lower division general education requirements...
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...Econ 100 Ch 1 & 2 Quiz marks = 35 STUDENT #________________________ Do not write name – ONLY Student # Multiple Choice Questions 1. Tammie makes $150 a day as a bank clerk. She takes off two days of work without pay to fly to another city to attend the concert of her favourite music group. The cost of transportation for the trip is $250. The cost of the concert ticket is $50. The opportunity cost of Tammie's trip to the concert is: A) $300. B) $450. C) $500. D) $600. 2. When a provincial government chooses to build more roads, the required resources are no longer available for spending on public education. This dilemma illustrates the concept of: A) marginal analysis. B) full employment. C) full production. D) opportunity cost. 3. When economists describe "a market," they mean: A) a place where stocks and bonds are traded. B) information networks that allow individuals to keep in touch with each other. C) a hypothetical place where the production of goods and services takes place. D) a mechanism which coordinates actions of consumers and producers to establish equilibrium prices and quantities. 4. The study of economics is primarily concerned with: A) keeping private businesses from losing money. B) demonstrating that capitalistic economies are superior to socialistic economies. C) choices which are made in seeking to use scarce resources efficiently. D) determining the most equitable distribution of society's output. 5. Economics may best...
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...Econ Problem Set #3 1. Suppose that a comic book publisher pays an annual licensing fee of $20,000 for the rights to an artist’s character. Which would have a larger impact on the number of readers of the comic using this character: (i) an increasing in the printing costs associated with publishing the comic, or (ii) an increase in the artist’s licensing fee to $22,000. Please carefully explain your reasoning. The increase in printing cost would have the larger impact on the number of readers of the comic. Because the increase in printing cost could be thought as a variable cost increase. The increase in cost would vary when the quantity increases. The increase costs per book could be easily realized and thus the publisher would choose to increase the price of goods. The number of readers would thus decrease due to increase of selling price. For the increase in license fee, it would be considered as fixed cost, which is more important in the short run business instead of long run businesses. 2. A firm's total cost schedule and the demand for its product are summarized in the table below (a) Complete the table and use the tools discussed in the online lecture and in the book to determine the level of output that maximizes the firm's profit. Costs | Revenues | Quantity Produced | Total Cost | Marginal Cost | Quantity Demanded | Price | Total Revenue | Marginal Revenue | 0 | 0 | - | 0 | 155 | 0 | - | 1 | 70 | 70 |...
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...ECON 150 Assignment #1 October 11th 2010 1. A) i. If the price of cells phones decreases there will be an increase in the demand. ii. If the price of a cell phone is expected to fall next month, the short term demand will decrease until the lower price emerges and then demand will increase at that time. iii. If the price of a call from a cellphone decreases, the demand for cell phones will increase. iv. If the price of a call increases from a landline the demand for cell phones will increase. v. The introduction of a camera phone will increase demand of cell phones. B) (See Attached Appendix 1) C) Event “i” illustrates the law of demand because everything is equal apart from the price. 2. A) The offering of online movie viewing will make the demand for in-store movie rentals more elastic. B) The cross elasticity of demand for online movie rentals would be positive because it is a substitute for in-store movie rentals C) The cross elasticity of demand would be negative with respect to high speed internet and online movie rentals because the service is complementary. 3. A) Based on the news clip wedding events are a normal good because as the income decreases, demand increases. B) Based on the news clip, weddings are more of a luxury because the demand is related to price and income. C) Given my answer to B, the income elasticity of demand would be greater than 1 because income is elastic in this...
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...Marketing Plan for Brand Roll of MarkStrat firm R Period 2 Submitted by: Zac Lennon Submitted to: The Board of Directors Executive Summary The brands performance for the first period wasn’t where we wanted it to be but we see many opportunities for this brand to grow and expand. The strength of this brand is that the performance level is higher than any of its competitors. The weakness is that this product has such a high base cost that we were forced to have such a high retail price. The plan to improve the brand performance is to do an R&D project to reduce the base cost which will allow us to make more money and to also reduce the selling price to its competitors. In return this will also put us in good standing with our primary target market and will make us the only firm with sole control of the explorer market. The performance objectives for the first period were as followed. The sales of the first period were 13,100, while we only got 8.1% of our primary target market. We understand completely that this isn’t good enough and we are doing everything in our power to fix this so it doesn’t happen again next period. Our goal for next period is to have at least 20% of the market share. We will see it is attainable because of all the changes that we will discuss with you later on this paper. I. Overview a. The brands current primary target segment is explorers. The other competitive brands in the segment are TOPS and LOOP. The brand in a way has a secondary...
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...ECON 252 Fall, 2012 Name Chapter 7 homework (50 pts.) Due Wednesday, October 24, 2012 1) (Explicit and Implicit Costs) Determine whether each of the following is an explicit cost or an implicit cost: a) Payments for labor purchased in the labor market b) A firm’s use of a warehouse that it owns and could rent to another firm c) Rent paid for the use of a warehouse not owned by the firm d) The wages that owners could earn if they did not work for themselves 2) (Alternative Measures of Profit) Calculate the accounting profit or loss as well as the economic profit or loss in each of the following situations: a) A firm with total revenues of $150 million, explicit cost of $90 million, and implicit costs of $40 million b) A firm with total revenues of $125 million, explicit cost of $100 million, and implicit costs of $30 million c) A firm with total revenues of $100 million, explicit cost of $90 million, and implicit costs of $20 million d) A firm with total revenues of $250,000, explicit cost of $275,000, and implicit costs of $50,000 3) (Production in the Short Run) Complete the following table. At what point does diminishing marginal returns set in? Units of the Variable Resource Total Product Marginal Product 0 0 — 1 10 — 2 22 — 3 — 9 4 — 4 5 34 — 4) (Costs in the Short Run) Identify each of the curves in the following graph: 5) (Total Cost and Marginal Cost)...
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