(3 points) Health capital decisions: What would happen to desired level ofhealth capital if there is...
(6 points) Suppose Fred and Barney have different time discount rates. There are two periods of life: “young”, and “old”. Fred’s present value of receiving a dollar next period is given by $1/(1+r), r=0.5 whereas Barney’s value for r is 0.02. Fred and Barney are currently “young”, living in Colorado, and deciding whether to become marijuana smokers. Suppose all utility is viewed in dollars, and they both value the current (when “young”) utility of smoking to be $10,000 and they...
There are 2 pages in this assignment. There are 3 questions with parts. The weight of each part is indicated in the margin. Please answer the questions carefully. When asked to draw a graph, make sure you label all the curves and the axes. Sloppy work will not be graded or will lose points. Read carefully Chapter 3 as well as your class notes. (30pts) 1. Consider a perfectly competitive economy with K amount of capital and L amount of...
Actions that damage a company and its employees should be stamped out, everyone would agree. But should the people responsible be stamped out, too? HBR CASE STUDY The Reign of Zero Tolerance by Ben Gerson "Mr. Pemberton?" manager. The guards had radioed her that the "Yes, that's me," Simon replied distractedly, his back turned. target wasn't putting up much resistance. "Your personal belongings will be messen The two burly gentlemen who had suddenly gered to your home later today," Sallie...
CASE 20 Enron: Not Accounting for the Future* INTRODUCTION Once upon a time, there was a gleaming office tower in Houston, Texas. In front of that gleaming tower was a giant "E" slowly revolving, flashing in the hot Texas sun. But in 2001, the Enron Corporation, which once ranked among the top Fortune 500 companies, would collapse under a mountain of debt that had been concealed through a complex scheme of off-balance-sheet partnerships. Forced to declare bankruptcy, the energy firm...