ECO 204 WEEK 2

Raise or Lower Tuition You have been hired by Nobody State University (NSU) as a consultant to help the university with how to increase their total revenue. The university has been struggling in recent years, so they have hired you to help them in their last attempt to find an appropriate solution so that the university can survive. Raise or Lower Tuition? Suppose that, in an attempt to raise more revenue, Nobody State University increases

14 Other / Other Other / ECO 204 WEEK 2 11 May 2015

Explain the difference between a positive and negative externality. In your analysis, make sure to provide an example of each type of externality. Why does the government need to get involved with externalities to bring about market efficiency? What solutions need to be provided for your examples?

4 Other / Other Other / ECO 204 WEEK 2 11 May 2015

Elasticity Analyze the determinants of the price elasticity of demand and determine if each of the following products are elastic or inelastic: o bottled water o toothpaste o cookie dough ice cream o fresh green beans o gasoline In your analysis, please make sure to explain your reasoning and relate your answers to the characteristics of the determinants of the price elasticity of demand.

5 Other / Other Other / ECO 204 WEEK 2 11 May 2015