Consider the state space model. Suppose there are three states in the economy next year. Suppose the annual risk- free rate is 25.00%. Consider the sets of state prices (01, 02, 93) given below. Check the box next to any set which cannot be a valid set of state prices. (0.28, 0.25, 0.22) (0.21, 0.22, 0.47) (0.07, 0.30, 0.53) (0.05,0.12, 0.73)

Consider an economy that is composed of identical individuals who live for two periods. These individuals have preferences over consumption in periods 1 and 2 given by U = /(C,) + (C2). They receive an income of 45 in period 1 and an income of 20 in period 2. They can save as much of their income as they like in bank accounts, earning an interest rate of 10% per period. They do not care about their children, so they spend all their money before the end of period 2. Each individual's lifetime budget constraint is given by C1 + C2/(1 + r) = Y1 + Y2/(1 + r). Individuals choose consumption in each period by maximizing lifetime utility subject to this lifetime budget constraint. (a) What is the individual's optimal consumption in each period? How much saving does he or she do in the first period? (b) The government has decided to set up a social security system. This system will take $10 from each individual in the first period, put it in the bank, and transfer it to each person with…

es Ergonomics Incorporated sells ergonomically designed office chairs. The company has the following information: Average demand = 31 units per day Average lead time = 45 days Item unit cost = $65 for orders of less than 350 units Item unit cost $63 for orders of 350 units or more Ordering cost = $40 Inventory carrying cost = 20% The business year is 250 days. a. How many chairs should the firm order each time? Assume there is no uncertainty at all about the demand or the lead time. b. What will the firm's average inventory be under each alternative? c. What will be the annual ordering and holding costs for each alternative?

Socioeconomic impacts of COVID-19 – can globalization prevail in the face of the impeding recession?As the COVID-19 crisis continues to deepen, the significant health and economic consequences of this disease is crippling even the most developed nations. With < 0.5% of globally confirmed cases occurring in Africa, the continent appears so far to be relatively spared the untoward direct health consequences of the COVID-19 pandemic. The disease nonetheless has already had a destabilizing effect on the lives of millions of Africans with disproportionate impact on the poor and underserved. The interconnectedness that characterizes globalization has brought economic benefits to many African countries. With COVID-19, there have been disruptions in Africa’s global supply chains in the face of tumbling oil prices and a lowered global demand for African non-oil products, which constitutes a threat to the economic stability of the continent. Projected losses from oil shocks alone may result…