Business, 06.11.2019 04:31, destinypierre
Choochoo company operates trains on a new railroad running through a rural town called wellspring, earning the company revenues of $15,000 a day and incurring no explicit costs. however, the sparks created from running trains is leading to fires in neighboring corn fields. the fires cause $5,000 in damaged crops per day. property rights are such that choochoo company can operate as many trains as it wishes with no regulation
a. what are the private and social costs associated with running trains in wellspring?
b. cooltech corp develops a device that can control the sparks and prevent trains from causing fires. cooltech rents this device out for $7.000 a day. given the current assignment of property rights would choochoo company be willing to rent this device? would farmers be willing to rent it?
c. in the interest of economic efficiency should cooltech's device be installed? given the current property rights can this outcome be achieved? briefly explain how.
d. suppose that all the costs to the residents were actually underestimated and are actually twice what they were ($10,000). in the interest of economic efficiency should cooltech's device be installed for
choochoo company's trains? given the current property rights can this outcome be achieved? briefly explain how.
e. how might your answers to parts c) and d) change if property rights were assigned to farmers in wellspring?
Answers: 1
Business, 22.06.2019 12:10, weeman6546
Lambert manufacturing has $100,000 to invest in either project a or project b. the following data are available on these projects (ignore income taxes.): project a project b cost of equipment needed now $100,000 $60,000 working capital investment needed now - $40,000 annual cash operating inflows $40,000 $35,000 salvage value of equipment in 6 years $10,000 - both projects will have a useful life of 6 years and the total cost approach to net present value analysis. at the end of 6 years, the working capital investment will be released for use elsewhere. lambert's required rate of return is 14%. the net present value of project b is:
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Business, 22.06.2019 19:10, lizzlegnz999
After the price floor is instituted, the chairman of productions office buys up any barrels of gosum berries that the producers are not able to sell. with the price floor, the producers sell 300 barrels per month to consumers, but the producers, at this high price floor, produce 700 barrels per month. how much producer surplus is created with the price floor? show your calculations.
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Business, 22.06.2019 23:10, jazare05
Jake and janelle loved to prepare gourmet meals for friends and family. they started a business of preparing theme-type dinners for friends who were having parties. to generate even more interest in the business, janelle created on her website. she posted pictures of events, and close-ups of the food they served. she encouraged patrons and others to post reviews, comments, and favorite recipes, and to share their own party ideas. her promotion became a dialogue between buyers of her service and the business. interactive promotion infomercials product placement broadcast
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Choochoo company operates trains on a new railroad running through a rural town called wellspring, e...
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