Economics Questions and Answers

Economics

Until about 2006, the European Union guaranteed a price of sugar for its farmers that was roughly double the world level. Using a well-labeled diagram of the market for sugar within the EU, show...

Latest answer posted February 9, 2015 8:33 pm UTC

1 educator answer

Economics

There are at least two important problems with this rationale. First, even if monopolies are "sure things," this fact will already be taken into account in the price of their stock. Everyone would...

Latest answer posted August 21, 2012 1:59 pm UTC

1 educator answer

Economics

Most economists argue that the government should not raise the minimum wage because doing so hurts the very people that the minimum wage is supposed to help. The minimum wage is supposed to help...

Latest answer posted September 12, 2012 1:47 am UTC

1 educator answer

Economics

In order to answer this question, what you need to do is to find three ordered pairs for each country. By finding these three points, you will be able to draw a production possibilities frontier....

Latest answer posted September 11, 2015 6:22 pm UTC

1 educator answer

Economics

Marxism continues to be an ideology and framework for understanding nation-state and economic realities around the world. In terms of analysis of boss/owner-worker relations and dynamics, Marxism...

Latest answer posted February 2, 2020 11:37 pm UTC

1 educator answer

Economics

In the years covered by the consumer price index data provided here, there were no years in which deflation occurred. Deflation occurs when average prices actually go down. It is not the same...

Latest answer posted November 9, 2012 9:35 pm UTC

1 educator answer

Economics

The market diagram of a product is a graphical way of representing the price of the product as a function of the quantity demanded. In the graph, points on the y-axis represent the price and the...

Latest answer posted February 14, 2014 4:57 am UTC

1 educator answer

Economics

If we want to have higher real wages, then the productivity of the workers who are earning the wages must be higher and the real market value of the products they produce must also be higher (all...

Latest answer posted April 17, 2015 3:18 am UTC

1 educator answer

Economics

The best answer to this question is E. Planned investment is the amount of some good that a firm plans to make and to sell in a given time period. For example, a firm might expect to sell 80,000...

Latest answer posted July 6, 2012 4:40 am UTC

1 educator answer

Economics

As I understand it, all you are asking for is help in understanding the table that is in Question 5. This is a table that shows you the cross elasticity of demand for these three products. On the...

Latest answer posted June 16, 2015 5:05 am UTC

1 educator answer

Economics

The difficulty with using evidence to prove an economic system good or bad is that "good" and "bad" are value terms. Some people would call an economic system good which increases overall GDP but...

Latest answer posted September 22, 2012 9:03 am UTC

1 educator answer

Economics

The most likely answer here is A. Marginal returns rise at first, then drop. In extreme cases, they could even become negative. This is due to the law of diminishing marginal returns. This law...

Latest answer posted May 5, 2013 11:29 pm UTC

1 educator answer

Economics

Using the data given in the link that you provided, we can see that inflation in the United States was generally higher than that of the other truly industrialized countries for which information...

Latest answer posted November 9, 2012 9:41 pm UTC

1 educator answer

Economics

While it is hard to know this for sure, contractionary monetary policy is more likely to be effective than expansionary monetary policy is. This is because contractionary monetary policy requires...

Latest answer posted February 17, 2013 5:00 am UTC

1 educator answer

Economics

This statement is true. Negative externalities lead to a situation where too many resources are allocated to the making of a given good. When the production of a good brings about negative...

Latest answer posted September 13, 2012 1:54 am UTC

1 educator answer

Economics

The chase strategy refers to one of a number of ways that companies plan production. Holding a surplus of goods before sale has a number of overhead costs. These costs include the cost of...

Latest answer posted April 20, 2016 4:25 pm UTC

1 educator answer

Economics

This statement is true. It is a statement that tells us why the free market fails to produce "public goods" and why the government must act to remedy the situation. Public goods are ones, like...

Latest answer posted September 14, 2012 1:12 pm UTC

1 educator answer

Economics

The marginal revenue is found by calculating how much more revenue is received by the firm when it produces and sells another unit of its product. In the case of the table about which you are...

Latest answer posted September 25, 2012 2:12 pm UTC

1 educator answer

Economics

Ha! I guess Ramen noodles never really did go by the wayside, but I am noticing that now there are many more flavors and lots more space on the shelf for them. The same goes for Vienna Sausages...

Latest answer posted September 28, 2011 7:03 am UTC

11 educator answers

Economics

In this situation, the central bank should increase the supply of money. You have expressed concern that this would lead to inflation. However, the fact that the velocity of money has decreased...

Latest answer posted August 8, 2012 2:00 pm UTC

1 educator answer

Economics

To answer this, let us first think about what inflation does to the value of money. Simply put, it reduces the value of money. Each dollar is worth a little less after inflation than it was...

Latest answer posted March 22, 2013 7:05 pm UTC

1 educator answer

Economics

Of course, no one can know for sure if the country is facing deflation. If economists could accurately predict what would happen and what to do about it, the country would never face economic...

Latest answer posted January 29, 2012 11:49 am UTC

1 educator answer

Economics

The major cause of the Mexican Peso Crisis of 1994 was political. This was an election year in Mexico and the outgoing president, Carlos Salinas de Gortari, spent too much money trying to...

Latest answer posted February 10, 2012 10:26 pm UTC

1 educator answer

Economics

In an oligopolistic market, a certain good or service is provided by a small number of sellers (for example, if in your town there are only two or three available providers of internet, you've got...

Latest answer posted September 25, 2013 4:43 pm UTC

1 educator answer

Economics

I assume that you are asking about production possibilities curves/frontiers. I have edited your question to reflect this. A production possibilities curve (PPC) shows what outcomes are efficient...

Latest answer posted September 11, 2012 3:27 am UTC

1 educator answer

Economics

The correct answer to this is C. This is a case of asymmetric information. First of all, we know that this is not A or B. The ceteris paribus assumption is the assumption that is typically made...

Latest answer posted October 1, 2012 2:50 am UTC

1 educator answer

Economics

Consumers exhibit both rational and emotion behavior when buying a house. It is best if they are rational, but this is not always possible. Rationally, customers do things like targeting homes...

Latest answer posted July 15, 2013 2:26 am UTC

1 educator answer

Economics

Based on past behavior of the Department of Treasury and the Federal Reserve, particularly during and right after the 2007 financial crisis and resulting Great Recession, the Department of Treasury...

Latest answer posted March 10, 2016 11:15 pm UTC

1 educator answer

Economics

One reason why poverty exists in a country like Mexico, which has natural resources and is a fairly rich nation, is a high degree of inequality. When the rich make money, they keep it to...

Latest answer posted June 27, 2017 12:42 pm UTC

2 educator answers

Economics

Theoretically, international trade should result in a situation where more goods and services are produced in the world as a whole than would be produced if there were no trade. The reason for...

Latest answer posted November 8, 2011 3:25 am UTC

1 educator answer

Economics

The major reason for privatization is the idea that the government cannot run firms as efficiently as the private sector can. When companies are owned by the government, the actions taken by the...

Latest answer posted February 20, 2012 11:44 pm UTC

1 educator answer

Economics

In the long run, price ceilings such as rent control do not end up providing more low-cost housing in a given area. In this way, they are typically somewhat counterproductive. The law of supply...

Latest answer posted March 19, 2013 5:18 am UTC

1 educator answer

Economics

Of the options given in this question, the best choice is the second; a decrease in demand for highly skilled workers in the labor force has helped contribute to inequality. We can see this partly...

Latest answer posted October 27, 2012 2:06 pm UTC

1 educator answer

Economics

The actual use of toll roads is not typically seen as price gouging. In general, tolls are not so high as to qualify for this (unscientific) term. One could argue that the new trend towards...

Latest answer posted October 15, 2011 11:56 am UTC

1 educator answer

Economics

Not long ago, I bought a Kindle for my daughter for Christmas. There are many things that could change the supply and demand (as opposed to simply moving supply or demand along the same curve) for...

Latest answer posted January 15, 2013 12:16 am UTC

1 educator answer

Economics

Though it may seem daunting if you're not used to working with demand curves, this question is very straightforward. We are given that the weekly demand is Qd, the price is P, and the two are...

Latest answer posted May 27, 2016 8:15 pm UTC

1 educator answer

Economics

This statement is false. This is essentially the opposite of what a public good is. A public good is something that everyone can consume. It is not something that you can prevent anyone from...

Latest answer posted September 16, 2012 12:41 am UTC

1 educator answer

Economics

While there are reasons why a larger government spending multiplier is worse than a smaller one, I would say that a multiplier of 8 is better than a multiplier of 2. In general, it is somewhat bad...

Latest answer posted September 13, 2015 2:04 am UTC

1 educator answer

Economics

Barriers to entry can do this in a number of ways. A few of them are: Economies of scale keep new entrants out because they give an advantage to large firms. If there are economies of scale in a...

Latest answer posted February 20, 2012 6:40 am UTC

1 educator answer

Economics

According to the U.S. Department of Commerce's Bureau of Economic Analysis (BEA), the price index for gross domestic purchases during the second quarter of 2018 did in fact increase by 2.3 percent...

Latest answer posted August 4, 2018 1:47 am UTC

1 educator answer

Economics

Earmarks could be non-stimulative for at least two reasons. First, if we assume that the money would have been spent regardless of whether it was earmarked, the process of earmarking does not...

Latest answer posted June 1, 2011 10:19 pm UTC

1 educator answer

Economics

This is a controversial topic and the answer to the question tends to depend on the political opinions of the person answering. We know that the economic crisis came about because the housing...

Latest answer posted May 9, 2012 5:25 pm UTC

1 educator answer

Economics

A government stimulus would have a multiplier effect on the economy because the money that the government spends on the stimulus would be spent over and over again by various people in the economy....

Latest answer posted June 1, 2011 10:26 pm UTC

1 educator answer

Economics

Price elasticity of demand will affect how much a nation imports if there is a price difference between domestically made products and imports and if people generally prefer to buy domestic...

Latest answer posted April 3, 2012 2:53 am UTC

1 educator answer

Economics

This question assumes that I am an individual working for a company in a perfectly competitive market. I know the secret of the new method but I do not benefit from it. Therefore, I want to sell...

Latest answer posted April 21, 2012 2:28 pm UTC

1 educator answer

Economics

When calculating GDP using the income approach, one thing that must be measured is the gross operating surplus that is generated by the various firms in the economy. The gross operating surplus is...

Latest answer posted August 28, 2011 5:03 am UTC

1 educator answer

Economics

The price elasticity of supply does not have any great effect on general market demand. Supply and demand do not typically affect one another. Price elasticity of supply tells us how much the...

Latest answer posted September 21, 2012 1:46 am UTC

1 educator answer

Economics

An economist would say that minimum wage should be abolished because it reduces the amount of work that is available for workers, particularly those who are less skilled. A minimum wage sets a...

Latest answer posted August 27, 2012 1:50 pm UTC

1 educator answer

Economics

Kay's opportunity cost for pursuing her doctorate will be $175,000. In order to calculate this, we must first figure out how much money she could have made if she started working full time rather...

Latest answer posted October 9, 2012 10:50 pm UTC

1 educator answer

Economics

You have asked two questions, I have eliminated one of them and am giving you a response for the other. Interest rates are not constant for all loans that are given. They vary based on several...

Latest answer posted March 7, 2011 9:39 pm UTC

1 educator answer

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