To understand the interplay of observations and models you must first be able to distinguish between things that we observe and things that we infer from models. Consider the following statements about the Sun. Classify each statement as an observation or as an inference based on the current, accepted model for the Sun. Observations
the photosphere is made mostly of hydrogen and helium
the photosphere emits mostly visible light.
the corona is hotter than the photosphere.
the sun emits neutrinos.
the sun generates energy by fusing hydrogen into helium in its core.
the core temperature is 10 million k
the convection zone is cooler than the radiation zone.
the composition of the photosphere is the same as that of the gas cloud that gave birth to our solar system.

David consumes two things: gasoline (g) and bread (b). david's utility function is u(g, b) = 10g^0.25 b^0.75. use the lagrange technique to solve for david's optimal choices of gasoline and bread as a function of the price of gasoline, p_g, the price of bread, p_b, and his income m. with recent decrease in the price of gasoline (maybe due to external shock such as shale gas production) does david increase his consumption of gasoline? for david, how does partial differential g/partial differential p_g depend on his income m? that is, how does david's change in gasoline consumption due to an increase in the price of gasoline depend on his income level? to answer these questions, find the cross-partial derivative, |partial differential^2 g/partial differential m partial differential p_g.

Which of the following best describes the economic effect that results from the government having a budget surplus? a. consumers save more and spend less, enabling long-term financial planning. b. overall demand decreases, reducing the incentive for producers to increase production. c. banks have more deposits, enabling them to make more loans to investors. d. government spending increases, increasing competition for goods and services and driving prices up.

For 2016, gourmet kitchen products reported $22 million of sales and $19 million of operating costs (including depreciation). the company has $15 million of total invested capital. its after-tax cost of capital is 10%, and its federal-plus-state income tax rate was 36%. what was the firm’s economic value added (eva), that is, how much value did management add to stockholders’ wealth during 2016?