Macro
Suppose that there are two goods (X and Y). The representative consumer's preferences over these two goods are given by the utility function U = ?X Y, and income is given by I. a. Let the prices of the two goods be represented by Py and Py. What are the demand functions for these two goods? Derive the expenditure function. 3. Suppose that the government gives the consumer a voucher that can be used to purchase X, but not Y. The value of the voucher is V. Show how this changes the consumer's decision problem. Suppose that instead of a voucher that can only be used to purchase X, the government gives the consumer a voucher that can be used to buy either X or Y. Again, the value of the voucher is V. Keeping the value of V the same as in part (b), are there values of V for which the consumer would be indifferent between the two programs? Are there values of V for which the consumer would prefer one program to the other?
[10:57 PM, 10/20/2021] Fridah: nsider the following airfare game between Qantas and Virgin. Suppose Qantas and Virgin are the only two airlines flying from Melbourne to Sydney. The capacity is 150 passengers for each airline. Each airline has two pricing strategies: charge a regular airfare at $300 or charge a discount airfare at $200. The market demand is uncertain and could be either high or low with equal probability. When demand is high, 260 people would like to take the Melbourne- Sydney trip when the airfare is $300, and additional 120 people (so 380 people in total) would like to take the trip when the airfare is $200. When demand is low, 220 people would like to take the trip when the airfare is $300, and additional 100 people (so 320 people in total) would like to take the trip when the airfare is $200. To make our life easier, we assume that discount air tickets always go to the passengers with highest willingness to pay first. Both airlines have to simultaneously set their airfare before demand is realized. When both airlines set the same airfare, they share the market equally. Moreover, both airlines have the same cost structure with TC(q) = 19000 + 70q.
Calculate the expected profit for each airline when both airlines set the airfare at $300. Calculate the expected profit for each airline when both airlines set the airfare at $200. Calculate the expected profit for each airline when the two airlines set different airfares. Construct the payoff matrix for this airfare game between Qantas and Virgin. Find all Nash equilibria of the game. Suppose now demand is high with probability p and low with probability 1 - p. Other things remain unchanged. Construct the payoff matrix for this new airfare game and find p*, a threshold value of p, such that ($200; $200) is a Nash equilibrium if and only if p ? p*: [10:58 PM, 10/20/2021] Fridah: 2. An intervention has the following cost and benefit profile:
Baseline cost = 400,000 Range: 200,000 - 1,200,000
Baseline benefit= 10 life yrs Range 5 - 20
a. Calculate the cost effectiveness ratio
b. Perform a sensitivity analysis.
c. If the cost effectiveness cutoff is 100,000/life yr, when is the intervention not cost effective? What if the cutoff is $50,000 per life yr? [11:29 PM, 10/20/2021] Fridah: Harrod model can be considered as special case of the Solow model with the Cobb-Douglas production function in following ways:-
1.Output is regarded as net output after making allowance for the depreciation of capital.
2.There are constant returns to scale.
In other words, the production function is homogeneous of the first degree. 3.Prices and wages are flexible. There is perpetual full employment of labor.
4.Labour and capital are substitutable for each other. There is neutral technical progress. The saving ratio is constant.
L (t) = K....(1)
Solow regards n as Harrod's natural rate of growth in the absence of technological change; and L(t) as the available supply of labor at time (t).
The right hand side of equation (1) shows the compound rate of the growth of labor force from period 0 to period t. alternatively equation (1) can be regarded as a supply curve of labor.
"It says that the exponentially growing labor force is offered for employment completely in-elastically.
The labor supply curve is a vertical line, which shifts to the right in time as the labor force grows according to (1).
Then the real wage rate adjusts so that all available labor is employed, and the marginal productivity equation determines the wage rate which will actually rule."
Solow is a pioneer in constructing the basic neo-classical model where he retains the main features of the Harrod-Domar model like homogeneous capital, proportional saving function and a given growth rate in the labor force.
He takes a continuous production function, which has come to be known as the neoclassical production function, in analyzing the process of growth.
The assumption of substitutability between labor and capital gives the growth process adjustability and provides a touch of realism. Unlike the Harrod-Domar model, he demonstrates steady-state growth paths.
Last but not the least, the long-run rate of growth is determined by an expanding labor force and technical progress.
Thus Professor Solow has successfully shunted aside all the difficulties and rigidities which go into the modern Keynesian income analysis. [11:39 PM, 10/20/2021] 1. What variables must be considered in designing the organizational structure for international operations? How do these variables interact, and which are most important?
2. Discuss the implications of the relative centralization of authority and decision making at headquarters versus local units or subsidiaries. How would a subsidiary manager feel about this variable?
3. What are the four (4) major alternative staffing approaches for international operations? Explain the relative advantages of each and the conditions under which one would choose one approach over another.
4. Develop a cultural profile which might be applicable to many workers in Mexico and discuss the management that can be use.
5. Using Mexico as an example, discuss how one would develop a profile of an effective leader from the research results of the GLOBE project. [2:35 AM, 10/21/2021] Fridah: 1. What are the four key characterist

Question

Macro

Suppose that there are two goods (X and Y). The representative consumer's preferences over these two goods are given by the utility function U = ?X Y, and income is given by I. a. Let the prices of the two goods be represented by Py and Py. What are the demand functions for these two goods? Derive the expenditure function. 3. Suppose that the government gives the consumer a voucher that can be used to purchase X, but not Y. The value of the voucher is V. Show how this changes the consumer's decision problem. Suppose that instead of a voucher that can only be used to purchase X, the government gives the consumer a voucher that can be used to buy either X or Y. Again, the value of the voucher is V. Keeping the value of V the same as in part (b), are there values of V for which the consumer would be indifferent between the two programs? Are there values of V for which the consumer would prefer one program to the other?

[10:57 PM, 10/20/2021] Fridah: nsider the following airfare game between Qantas and Virgin. Suppose Qantas and Virgin are the only two airlines flying from Melbourne to Sydney. The capacity is 150 passengers for each airline. Each airline has two pricing strategies: charge a regular airfare at $300 or charge a discount airfare at $200. The market demand is uncertain and could be either high or low with equal probability. When demand is high, 260 people would like to take the Melbourne- Sydney trip when the airfare is $300, and additional 120 people (so 380 people in total) would like to take the trip when the airfare is $200. When demand is low, 220 people would like to take the trip when the airfare is $300, and additional 100 people (so 320 people in total) would like to take the trip when the airfare is $200. To make our life easier, we assume that discount air tickets always go to the passengers with highest willingness to pay first. Both airlines have to simultaneously set their airfare before demand is realized. When both airlines set the same airfare, they share the market equally. Moreover, both airlines have the same cost structure with TC(q) = 19000 + 70q.

Calculate the expected profit for each airline when both airlines set the airfare at $300. Calculate the expected profit for each airline when both airlines set the airfare at $200. Calculate the expected profit for each airline when the two airlines set different airfares. Construct the payoff matrix for this airfare game between Qantas and Virgin. Find all Nash equilibria of the game. Suppose now demand is high with probability p and low with probability 1 - p. Other things remain unchanged. Construct the payoff matrix for this new airfare game and find p*, a threshold value of p, such that ($200; $200) is a Nash equilibrium if and only if p ? p*: [10:58 PM, 10/20/2021] Fridah: 2. An intervention has the following cost and benefit profile:

Baseline cost = 400,000 Range: 200,000 - 1,200,000

Baseline benefit= 10 life yrs Range 5 - 20

a. Calculate the cost effectiveness ratio

b. Perform a sensitivity analysis.

c. If the cost effectiveness cutoff is 100,000/life yr, when is the intervention not cost effective? What if the cutoff is $50,000 per life yr? [11:29 PM, 10/20/2021] Fridah: Harrod model can be considered as special case of the Solow model with the Cobb-Douglas production function in following ways:-

1.Output is regarded as net output after making allowance for the depreciation of capital.

2.There are constant returns to scale.

In other words, the production function is homogeneous of the first degree. 3.Prices and wages are flexible. There is perpetual full employment of labor.

4.Labour and capital are substitutable for each other. There is neutral technical progress. The saving ratio is constant.

L (t) = K....(1)

Solow regards n as Harrod's natural rate of growth in the absence of technological change; and L(t) as the available supply of labor at time (t).

The right hand side of equation (1) shows the compound rate of the growth of labor force from period 0 to period t. alternatively equation (1) can be regarded as a supply curve of labor.

"It says that the exponentially growing labor force is offered for employment completely in-elastically.

The labor supply curve is a vertical line, which shifts to the right in time as the labor force grows according to (1).

Then the real wage rate adjusts so that all available labor is employed, and the marginal productivity equation determines the wage rate which will actually rule."

Solow is a pioneer in constructing the basic neo-classical model where he retains the main features of the Harrod-Domar model like homogeneous capital, proportional saving function and a given growth rate in the labor force.

He takes a continuous production function, which has come to be known as the neoclassical production function, in analyzing the process of growth.

The assumption of substitutability between labor and capital gives the growth process adjustability and provides a touch of realism. Unlike the Harrod-Domar model, he demonstrates steady-state growth paths.

Last but not the least, the long-run rate of growth is determined by an expanding labor force and technical progress.

Thus Professor Solow has successfully shunted aside all the difficulties and rigidities which go into the modern Keynesian income analysis. [11:39 PM, 10/20/2021] 1. What variables must be considered in designing the organizational structure for international operations? How do these variables interact, and which are most important?

2. Discuss the implications of the relative centralization of authority and decision making at headquarters versus local units or subsidiaries. How would a subsidiary manager feel about this variable?

3. What are the four (4) major alternative staffing approaches for international operations? Explain the relative advantages of each and the conditions under which one would choose one approach over another.

4. Develop a cultural profile which might be applicable to many workers in Mexico and discuss the management that can be use.

5. Using Mexico as an example, discuss how one would develop a profile of an effective leader from the research results of the GLOBE project. [2:35 AM, 10/21/2021] Fridah: 1. What are the four key characterist