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The GDP fails to capture changes in the availability of leisure time and often fails to reflect changes in the quality of products or in the availability of new products." Discuss this statement from
Explain the difference between absolute advantage and comparative advantage. Which is more important in determining trade patterns, absolute advantage or comparative advantage? Why?
The percentage of the U.S. labor force that belongs to labor unions has been declining for several decades? What are some of the reasons that labor unions are less prevalent today than they were forty
Mary wants to get more money from her house cleaning business. Why doesn t Mary try to increase her revenue by lowering her price below the prevailing market price?
People who want to work but have stopped looking for work because they could not find jobs after actively searching are called
Microeconomics focuses principally on social and political issues, while macroeconomics involves the study of a nation's monetary system.
The Law of Demand states that the demand for a product is inversely related to the price of such product. Therefore, the demand for a product is considered downward sloping. This implies that quantity
Firms can shift their marginal cost curves to the right, resulting in higher outputs at the same or lower maximum-profit prices. This can be done by
Suppose that US prices rise 4 percent over the next year while prices in Mexico rise 6%. According to the purchasing power parity theory of exchange rates, what should happen to the exchange rate betw
Considering an economy with a current trade deficit and considering only the direct effect on income, an expansionary monetary policy tends to
Use the national income identity GDP= C + I + G + X to explain what a current account deficit(negative net exports) means in terms of domestic spending, production, and borrowing
What will this do to the demand curve? Of the available list of things in the text that causes a change in demand, which best fits here as the cause of the demand shift?
Which definition(s) of the money supply include(s) only items which are directly and immediately usable as a medium of exchange?
What are two ways for a competitive firm to determine the optimal level of production, that is, the level of production that will maximize profit or minimize losses?
By specializing in the production of one good, a company is able to benefit from economies of scale which increases its revenue. Which of the following is an attribute of specialization?
Branding Iron Products a specialty steel fabricator operates a plant in the town of West Star, Texas. The Town has grown rapidly because of recent discoveries of oil and gas in the area. Many of the n
Copy the budget line and indifference curve I2 on your answer sheet. Suppose the prices of good X decrease by $2 per unit. Sketch (as accurately as you can) the new budget line in the diagram and indi
Which statement is not true regarding risk? the expected return is usually not the same as the actual return a key to assess risk is determining how much risk an investment adds to a portfolio s
If the cost of producing Newton’s Donuts is constant at $0.15 per donut, should they reduce the price and thereafter, sell more donuts (assuming profit maximization is the company’s goal)?
Draw the cheese market for the United States showing the world price as the price for this market. How much cheese does the U.S. import at the world price?
Unemployment is low and inflation is rising, but slowly. Gross Domestic Product is also rising. The Federal Reserve may increase the reserve requirement at this point in order to
In 2006 rental car companies often charged more to rent a compact car than an SUV or a luxury vehicle Why do you think rental companies turned their normal pricing structure on its head?
Assume that a national restaurant firm called BBQ builds 10 new restaurants at a cost of $1 million per restaurant. It outfits each restaurant with an additional $200,000 of equipment and furnishings
When the product demand curve is Q = 130 - 20P, and price is increased from P1= $4 to P2= $6,the arc price elasticity of demand is:
In the article, "Is Free Trade Pass ," Paul Krugman summarizes and explains research that challenges, and presents alternatives to, the assumptions of classical trade theory based on comparative advan