The present price (year 0) of kerosene is $4.30 per gallon, and its cost is expected increase by 10% per year. (at the end of year 1, kerosene will cost $4.73 per gallon.) mr. garcia uses about 800 gallons of kerosene for space heating during a winter season. he has an opportunity to buy a storage tank for $600, and at the end of four years, he can sell the storage tank for $100. the tank has a capacity to supply 4 years of mr. garcia's heating needs. so, he can buy four years worth of kerosene at its present price ($4.30), or he can invest his money elsewhere at 6% interest. should he purchase the storage tank? assume that kerosene purchased on a pay-as-you-go basis is paid for eoy (end of year). (however, kerosene purchased for the storage tank is purchased now.)

The distinction between a normal and an inferior good is

Suppose the marginal damage and marginal benefit curves in a polluted neighborhood are md = p/3 and mb = 4 – p. also, suppose that transactions costs are low, so that the consumers and the firm can bargain. we saw that in this case, the socially-optimal level of pollution is achieved. start by computing the socially-optimal p. then, for each of the following cases, compute the amount of money transferred through the bargaining process, and indicate who pays whom (i.e., whether consumers pay the firm, or vice versa). also, compute the gains to each party relative to the status quo (i.e., the starting point of the bargaining process).a)consumers have the right to clean air; firm is dominant in the bargaining process.b)consumers have the right to clean air; consumers are dominant in the bargaining process.c)firm has the right to pollute; firm is dominant in the bargaining process.d)firm has the right to pollute; consumers are dominant in the bargaining proces

Which statement best explains the relationship between points a and b? a. consumption reaches its highest point, and then supply begins to fall. b. inflation reaches its highest point, and then the economy begins to expand. c. production reaches its highest point, and then the economy begins to contract. d. unemployment reaches its highest point, and then inflation begins to decrease.