1. Say we have two types of economic agents: manufacturing firms and households. For manufacturers, say output Q=12 units; transportation cost per mile per good is t=0.5; markup, p-c=1; lot size, L=1. At how far out, is the willingness to pay for land for manufacturing firms equal to zero? Draw and label the bid rent graph.

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Suppose that the demand for loanable funds for car loans in the Milwaukee area is $12 million per month at an interest rate of 10 percent per year, $13 million at an interest rate of 9 percent per year, $14 million at an interest rate of 8 percent per year, and so on. If the supply of loanable funds is fixed at $16 million, what will be the equilibrium interest rate? Instructions: Enter your answer as a whole number. * percent per year

Consider a two-period resource allocation model where the efficient allocation implies undiscounted total surplus of $142 and $100 in the first and second periods, respectively. Assume the rate of return on investment is 10 percent. The smallest possible intergeneration transfer that will make the efficient resource allocation sustainable is: Select one: a. $42. b. $20. c. $21. d. $15.

That the free flow of goods and capital creates economies of scale is not necessarily a good thing. Economies of scale encourage increased production which can lead to significant externalities, like pollution. Please provide a counter argument for the above statement

Provide a diagram showing the inefficient or underemployed resources in a hypothetical economy

Suppose that you own a 20-acre plot of land that you would like to rent out to wheat farmers. For them, bringing in a harvest involves $30 per acre for seed, $80 per acre for fertilizer, and $70 per acre for equipment rentals and labor. With these inputs, the land will yield 40 bushels of wheat per acre. Instructions: Enter your answers as a whole number. a. If the price at which wheat can be sold is $6 per bushel and if farmers want to earn a normal profit of $10 per acre, what is the most that any farmer would pay to rent your 20 acres? $ b. What price would the farmer pay to rent your 20 acres if the price of wheat rises to $7 per bushel?

Why is the production possibility frontier concave? Be sure to explain economic intuition behind that fact.