Economics Questions and Answers

Economics

Perhaps the best way to understand marginal costs, average total costs, and their intersection is to imagine yourself as a business owner. You've invented a new product, the wingding, and a small...

Latest answer posted November 28, 2020, 3:06 pm (UTC)

5 educator answers

Economics

On a most basic level, business provides a means of income for a population. People need money to not only survive, but to enjoy their lives. In exchange for their labor, businesses give money to...

Latest answer posted December 8, 2020, 11:57 am (UTC)

3 educator answers

Economics

Before getting into why a firm should be a price taker and not a price maker under perfect market conditions, let’s be clear about what the three terms in the question mean. Fortunately, these...

Latest answer posted January 12, 2021, 3:00 pm (UTC)

4 educator answers

Economics

Economists identify four primary kinds of market structures: pure competition, monopolistic competition, oligopoly, and monopoly. The market structure in which a business (or set of businesses)...

Latest answer posted April 28, 2021, 5:31 pm (UTC)

4 educator answers

Economics

Before discussing the possible advantages and disadvantages of the price system, it should probably be established what a price system is. Generally, a price system refers to an economy in which...

Latest answer posted February 18, 2021, 10:26 pm (UTC)

4 educator answers

Economics

An organization’s span of control can be determined by the number of employees reporting to the manager/ supervisor. A narrow span of control refers to a structure with few employees reporting to...

Latest answer posted September 19, 2016, 5:18 pm (UTC)

3 educator answers

Economics

For the purpose of this answer, let’s assume that the employee is choosing between the two jobs and not analyzing each job independently. One benefit of Job A is the higher starting salary....

Latest answer posted April 27, 2020, 11:01 pm (UTC)

3 educator answers

Economics

The United States economy has variously been described as "free market," "capitalist," and "mixed." The apparent confusion here is caused partly by the differing terms and approaches of different...

Latest answer posted March 28, 2021, 2:10 pm (UTC)

4 educator answers

Economics

In order to answer this question, we need to define what opportunity cost is. In a nutshell, opportunity cost refers to the benefits that you have given up by choosing one particular option. In...

Latest answer posted September 8, 2020, 10:52 am (UTC)

4 educator answers

Economics

A circular flow model describes how money, resources, and goods (or services) move from households to corporations and back again. On one side of the model, we have the product market. Corporations...

Latest answer posted February 25, 2021, 6:16 pm (UTC)

5 educator answers

Economics

Factor intensity can be defined with regards to factor proportions theory of production and trade, where the factor intensity can be narrowed down to individual products within an industry or in...

Latest answer posted December 21, 2015, 1:01 pm (UTC)

3 educator answers

Economics

Price elasticity of demand is the change in demand of a product based on the increase or decrease of the price of that product. It is of significant importance to the government because it is used...

Latest answer posted February 10, 2020, 8:15 pm (UTC)

4 educator answers

Economics

Price functions as a reflection of supply and demand in a free market economy. For example, if you want to buy a pack of gum, and there are lots of packs of gum available, the price will remain...

Latest answer posted April 22, 2018, 4:18 pm (UTC)

3 educator answers

Economics

There is a difference between functional income distribution and personal income distribution. Personal income distribution focuses on how income is divided among individuals in a country. It...

Latest answer posted October 13, 2016, 2:34 am (UTC)

2 educator answers

Economics

In theory, eliminating the middlemen sounds like a good idea. This would help to lower costs for consumers who could buy products for less and for businesses who could sell their products for less....

Latest answer posted June 26, 2016, 4:55 pm (UTC)

3 educator answers

Economics

Strictly speaking, the basic economic problem of scarcity can never truly be solved. This is because scarcity is a fact of social, and therefore of economic, life. However, the price mechanism can...

Latest answer posted July 5, 2020, 11:29 am (UTC)

4 educator answers

Economics

Fiscal policy and monetary policy are similar in two aspects. First, they both represent a nation’s policies to regulate its economy. They both can be expansionary to increase the aggregate demand...

Latest answer posted January 22, 2018, 12:52 am (UTC)

3 educator answers

Economics

To best answer this question, let's first look at the definitions of primary and secondary industries. A primary industry involves the collection and production of raw materials. For example, a...

Latest answer posted October 31, 2018, 12:30 pm (UTC)

2 educator answers

Economics

It looks like you may be referring to labor or personnel economics in your question. Labor or personnel economics is related to human resources management in terms of wages, human capital...

Latest answer posted March 2, 2017, 4:18 pm (UTC)

2 educator answers

Economics

Items that people are willing to buy even when prices increase are said to be demand inelastic. Overall, the demand for breakfast cereal is demand inelastic, because in western societies, cereal is...

Latest answer posted December 9, 2018, 2:51 pm (UTC)

3 educator answers

Economics

By July, 1987, the Single European Act (SEA) had been ratified by all the Parliaments of European Union member states and drafted into law. The SEA was directed at creating a single, unified...

Latest answer posted July 6, 2020, 5:56 pm (UTC)

3 educator answers

Economics

The best answer to this is that the availability of resources is the major determinant of supply in an economy that is growing rapidly. This is true both for the supply of individual goods and for...

Latest answer posted February 5, 2013, 2:18 am (UTC)

1 educator answer

Economics

Overall abundance does not mean that scarcity does not exist in certain markets or for certain people. This is because many factors can make an abundant resource scarce for some. Temporary crises...

Latest answer posted July 5, 2020, 7:16 pm (UTC)

3 educator answers

Economics

Microsoft is in a unique situation. They operate in several different, yet similar (and converging) markets, and have a vast power differential between the markets. In one area, they have almost...

Latest answer posted December 3, 2019, 7:03 pm (UTC)

4 educator answers

Economics

In economics, the change in consumption is related to the change in income by the marginal propensity to consume. If consumption changes by dY when the income changes by dX, the marginal propensity...

Latest answer posted July 17, 2015, 4:29 am (UTC)

1 educator answer

Economics

There is a difference between consumer products and industrial products. Industrial products include the machinery and resources used to make consumer products. Sometimes these products are...

Latest answer posted July 4, 2016, 12:44 am (UTC)

3 educator answers

Economics

Quality of capital per worker is an important factor in creating economic growth. As the quality of capital per worker increases, productivity increases and economic growth occurs. To understand...

Latest answer posted November 20, 2013, 3:33 pm (UTC)

1 educator answer

Economics

If a firm finds that the marginal product of capital is 60 and the marginal product of labor is 20, it will recognize that each dollar spent on capital resources will produce more than a dollar...

Latest answer posted June 27, 2020, 10:46 am (UTC)

5 educator answers

Economics

Marginal cost and marginal benefit are important factors when making economic decisions. Marginal cost is the cost of getting more of something. Marginal benefit is the gain we receive by getting...

Latest answer posted September 25, 2016, 4:29 pm (UTC)

2 educator answers

Economics

The marginal cost curve shows the relationship between the marginal cost of a product and a level of output for that product. When production of a product is in its beginning stage, the marginal...

Latest answer posted January 2, 2018, 8:15 pm (UTC)

3 educator answers

Economics

Von Thunen was a German geographer who devised a model to explain the location of various forms of land use. In particular, his model was devised after observing land use around cities in Germany...

Latest answer posted October 1, 2016, 7:47 am (UTC)

1 educator answer

Economics

If interest rates rise in the United States, this will generally cause exchange rates to rise. The strength of the dollar is not straightforwardly linked to the health of the US economy because the...

Latest answer posted September 29, 2020, 4:50 pm (UTC)

1 educator answer

Economics

The key difference between investment and consumption spending is that much of consumption spending is obligatory, while investment is discretionary. Imagine a middle-class suburban family. Their...

Latest answer posted October 15, 2018, 5:21 pm (UTC)

2 educator answers

Economics

A decrease in tax to GDP ratio of a country indicates: (B) less equitable distribution of national income. Let's consider why this is the correct answer: When income is distributed inequitably...

Latest answer posted May 3, 2017, 12:47 am (UTC)

2 educator answers

Economics

Export and import activities take goods or services created in one country into the market of another country. Exports and imports are vulnerable from many outside forces. Free trade agreements,...

Latest answer posted October 26, 2015, 11:56 pm (UTC)

2 educator answers

Economics

It is misleading to suggest that a free market means a level playing field or a pure meritocracy. Market economies do not exist in some ideal theoretical world with no history and no concrete...

Latest answer posted September 26, 2016, 5:32 pm (UTC)

4 educator answers

Economics

Public finance generally refers to the financial activities of public administration, or in other words, how a government plays a role in its economy. The economist Jonathan Gruber developed a...

Latest answer posted August 26, 2020, 2:24 am (UTC)

1 educator answer

Economics

While monopolies can often charge more than a non-monopolistic firm could, they do not necessarily charge the highest price possible. This is for a number of reasons. First of all, charging a price...

Latest answer posted January 16, 2020, 3:20 pm (UTC)

4 educator answers

Economics

The government can help influence the allocation of resources, or the ways in which producers have access to the means of production and the ways in which goods and services are distributed among...

Latest answer posted January 24, 2017, 12:55 am (UTC)

2 educator answers

Economics

If you are going to determine the opportunity cost for the trip, you have to include two things. First, you have to include the actual cost of making the trip. Then, you have to factor in what...

Latest answer posted February 23, 2012, 1:14 pm (UTC)

1 educator answer

Economics

The law of diminishing returns applies only in the short-term period because in the long term, a company can lower the costs of creating additional product and thereby improve returns. For example,...

Latest answer posted July 7, 2021, 12:55 pm (UTC)

2 educator answers

Economics

The economy is important to households, consumers (these two are essentially the same thing), and firms because it determines the sorts of opportunities those groups have to make money and to buy...

Latest answer posted July 19, 2015, 4:00 pm (UTC)

1 educator answer

Economics

There are two sides to any transaction. There is a seller, and there is a buyer. To use an example, when you enter a store to purchase something, you are the buyer. The store, or its owner, is the...

Latest answer posted April 18, 2020, 2:18 pm (UTC)

5 educator answers

Economics

The answer to this is that only Firm C is experiencing diseconomies of scale. A diseconomy of scale occurs when a firm's per unit costs increase as the firm produces more and more of a given good...

Latest answer posted October 16, 2011, 12:32 pm (UTC)

1 educator answer

Economics

Supply is the amount of a good or service that producers make available, and demand is the amount of that same good or service that consumers are willing to buy. In a market economy, supply and...

Latest answer posted December 11, 2018, 5:18 pm (UTC)

3 educator answers

Economics

Externalities are the effects of economic activity on third parties. Any activity is likely to affect others in some way, and the more significant the activity, the greater the externalities. If a...

Latest answer posted September 12, 2020, 8:05 am (UTC)

1 educator answer

Economics

The field of economics can be broken down into two main branches: macroeconomics and microeconomics. While macroeconomics studies the economy from a large scale perspective, such as on a city,...

Latest answer posted February 12, 2020, 2:02 pm (UTC)

4 educator answers

Economics

The consensus opinion among the vast majority economists about the government's role in the time of economic crisis is Keynesian—that the federal government is there to prop up the situation by...

Latest answer posted April 6, 2020, 12:53 pm (UTC)

2 educator answers

Economics

Investopedia defines a normal good as one that “experiences an increase in quantity demanded” when there is an increase in the income of an individual. Inferior goods, on the other hand, are...

Latest answer posted March 21, 2018, 12:25 pm (UTC)

2 educator answers

Economics

One of the positive externalities associated with constructing new roads is an increase in the efficiency with which vehicles can travel. All vehicles have an ideal speed at which their engines run...

Latest answer posted May 8, 2011, 3:05 pm (UTC)

2 educator answers

Showing 1-50 of 1278