Microeconomics Answers

A new government has been elected, largely on the platform of im- plementing a tax cut on top bracket earners with income above the threshold zT . They argued during the election campaign that this tax cut will stimulate the economy and will actually increase government revenue as a result. Everybody wins!
(a) Write down an expression for the average per person tax revenue generated from the top bracket. Define any variables you need.
(b) Determine an expression for the change in average per person revenue associated with a decrease in the top marginal tax rate as a function of the net-of-tax elasticity of taxable income (i.e., the elasticity with respect to (1 − t)). Show all of your work and explain intuitively what the expression means.

The income of a consumer increases by 10% resulting in a 12% increase in the demand for particular product. What type of a product is that

now consider an economy consists of four workers

Tommy eats only green eggs and ham. He has an income of $36. Green eggs have a price of $2 and ham has a price of $6.
a. On the graph below, draw in Tommy’s budget constraint. Put ham on the horizontal axis. Suppose Tommy’s income increases to $54. Also suppose that the price of ham and egg each rise by $10. Construct Tommy’s new budget constraint. What is the difference between the new and old budget constraints?

Tangi loves unam shandy,which she makes by combining one glass of oshikandela and two scoop of ice cream.pandu is on a diet that assigns points to food and drinks .one glass of oshikandela is one point and one scoop of ice cream is one point.she can consume any combination of oshikandela and ice cream as long as the total number is two points ,what kind of goods are oshikandela and ice cream for pandu

The slope of the investment function underscores the fact that

Construct a production possibility frontier to illustrate Tom's earnings potential between the two careers if initially, he was not working as a carpenter, then he worked one-week per month, then two-weeks per month, then three-weeks per month, finally four weeks per month (assuming only four weeks in a month)

Potatoes are used in the production of frozen french fries which are increasing in popularity in China as the number of fast food restaurants grow

The elasticity of supply of frozen french fries is liked to be more elastic then the elasticity of supply of fresh potatoes. Do you agree with it? Give your reasons

Your budget is such that if you spend your entire income on 2 goods x and y.. You can afford either 4 units of x and6 units of y or 12 units of x and 2 units of y.if you spent all your income on x, how many units of x you could buy?

Using the relevant diagram(s), illustrate and explain the effect of a price floor on a perfectly competitive firm?