Economics Answers

Suppose the equilibrium price for an average hospital stay in the absence of insurance is $10,000. At that price, 1000 people are hospitalized each year. Now suppose an insurer offers a policy to lower the out of pocket price of a stay to $100, and at that price, 1200 people are hospitalized.

a. If the Supply curve were upward sloping, would moral hazard be larger or smaller than you computed in b? Explain why.

b. If the Supply curve were upward sloping, would moral hazard be larger or smaller than you computed in b? Explain why.

Should the profits earned by (the central) Baskin Robbins Ice Cream Company be theoretically considered an economic profit or are they an implicit cost -- a royalty due to Mr. Robbins for creating 31 flavors? Asked differently, how do economists explain how/why firms in monopolistic competition break even?

How to calculate EPS if the formula is Earnings Per Share = Net Income – Preferred Dividend /
Weighted Average Common Shares Outstanding
for given values as follows:
Particulars Amount
Profit before taxes Rs 50 lakhs
Dividend declared per share Rs2
Price of the share prevalent on stock
exchange
Rs 200
Applicable tax rate 35%
Share capital of company 5 lakh shares
of Rs 10 each

What is normal inferior and giffen goods?

what are giffen goods and what happen to giffen goods if income rises

If Jan’s firm continues to grow, what recommendations would you make for future action? What else should she be thinking about doing to keep things moving smoothly? Be specific in your answer.

Assume Japanese government wanted to keep the labor costs in the aggricultural sector low. At the same time however the government wanted to increase the wage level and improve working conditions of Japanese workers. How can Japan achieve these two seemingly contradicting aims?

Starting with 2000’s capital in the world became increasingly mobile. According to the mainstream labor market model, assuming labor costs are the only factor the capital owners take into account, which countries are the ones capital will move from, and which countries are the ones capital will move in? Explain your answer.

One of the major complaints of the British people for Brexit is, the argument that labor mobility
enforced by EU on England, cause wage level of British workers to fall. Assume this claim of British citizens is correct. Show on two seperate graphs, one representing British labor market, the other labor market of the rest of EU. And show the effect of labor mobility in both markets. Explain in a few words the reason behind this process.

How did the scale effect created by the decrease in wage level affect the labor demand?