Economics Questions and Answers

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

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Economics

This depends on the circumstances. If the economy is in a recession and we are increasing government spending to act as a stimulus, then raising taxes will be a bad idea. In the event of a...

Latest answer posted March 20, 2013 1:42 pm UTC

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Economics

In theory, an increase in taxes leads to a decrease in gross domestic product while a decrease in taxes leads to an increase in GDP. Of course, there are many variables that exist in the real...

Latest answer posted January 24, 2012 3:31 am UTC

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Economics

In economic theory, a market consists of sellers and buyers of a good. Typically supply of the good will be available at a price that buyers are willing to pay, so that supply is matched by demand....

Latest answer posted May 21, 2020 12:19 pm UTC

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Economics

In general, this is not a very good idea. These two economic policies will be at cross purposes to one another and may well end up preventing the increased spending from having its desired...

Latest answer posted March 20, 2013 1:49 pm UTC

1 educator answer

Economics

A company with a monopoly is going to charge as much as it can get away with as long as the product is not a luxury good. If it is a luxury good, and people don't need it, the people might just...

Latest answer posted December 10, 2012 8:27 pm UTC

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Economics

This is really a question about what causes monopolies to exist. There are three typical causes of monopolies. They are: Ownership of a vital resource. If one firm owns all of something that is...

Latest answer posted August 18, 2012 4:25 pm UTC

1 educator answer

Economics

By definition, the answer to this question is B. A plant is at its minimum efficient scale if it produces the quantity of output that gives it the lowest possible long run average costs. Answer C...

Latest answer posted December 11, 2011 8:52 am UTC

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Economics

There is no way to know what the exact price level will be in this situation. We do not even know what the price level is before the Fed takes action so there is no way we can know what the new...

Latest answer posted November 27, 2012 2:18 am UTC

1 educator answer

Economics

Price discrimination occurs when a seller charges different prices to different consumers who buy the same product. In price discrimination, the difference in the cost of producing the product for...

Latest answer posted August 18, 2012 4:10 pm UTC

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Economics

To fill in the chart, you need to know what to do. The actual math is very easy because it requires only addition and subtraction and division. Here is what you need to do: To find the price,...

Latest answer posted September 26, 2012 4:00 pm UTC

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Economics

The influence of international private financial companies on global markets has two components. The first is the relatively transparent component, and the impact of these companies' decisions is...

Latest answer posted May 19, 2020 1:10 pm UTC

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Economics

This statement is not technically true, but it is true if a government is going to be prudent. A fiscal deficit is the difference between what a government spends and what it takes in in revenues....

Latest answer posted February 12, 2012 11:16 pm UTC

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Economics

Without knowing what tables you are referring to, it is not really possible to use the tables in this answer. However, the component of aggregate demand (AD) that fell the most during the...

Latest answer posted February 6, 2013 3:08 am UTC

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Economics

The main highlights of US fiscal policy over the last 100 years would have to be summed up by saying that the US moved more and more towards Keynesianism beginning with the Great Depression. In...

Latest answer posted July 14, 2011 1:46 pm UTC

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Economics

If a firm has a monopoly over this market, it will maximize its profits by selling the quantity of photographic paper at which the firm's marginal costs will equal its marginal revenues. Given the...

Latest answer posted August 18, 2012 4:06 pm UTC

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Economics

The process of a contractionary monetary policy involves reducing the money supply. The reduced money supply then leads to a reduction in the rate at which aggregate demand is increasing. As...

Latest answer posted March 15, 2013 2:36 pm UTC

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Economics

In economics, the term ceteris paribus means something like "all other things being equal." What it means is that we are assuming that only the variable that we care about will change and all...

Latest answer posted September 11, 2012 4:40 am UTC

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Economics

In perfect competition, the firm is a price taker. It must charge the same price as everyone else in the market. This means that it can make no economic profit. It also means that the price for...

Latest answer posted September 26, 2012 3:51 pm UTC

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Economics

The answer here is C. The bank in this case would be able to lend out $90 million. The reserve requirement for a bank is the percentage of its deposits that it must keep on hand. The rest of the...

Latest answer posted October 15, 2012 3:37 am UTC

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Economics

The law of demand says that the ability and willingness to buy a certain thing will increase (all other things being equal) when the cost of buying that thing decreases. When things are cheaper,...

Latest answer posted November 19, 2012 3:37 pm UTC

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Economics

Economics cannot truly answer this question because this is a normative issue. It is an issue based on values rather than on economic principles. Legalizing drugs would, according to economics,...

Latest answer posted April 10, 2012 1:08 am UTC

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Economics

A natural monopoly is one in which there are major economies of scale. To be technical, it is a market in which the long-run average cost of production continues to decline no matter how big the...

Latest answer posted August 18, 2012 3:56 pm UTC

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Economics

In economic terms, government provision of higher education is definitely not a public good. You might think it is a public good because it is good for the public as a whole when people get higher...

Latest answer posted May 5, 2015 4:54 am UTC

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Economics

This term is used to talk about how hard or easy it is for a firm to enter a particular market. This is one way of differentiating between the different market structures. Barriers to entering...

Latest answer posted August 18, 2012 4:02 pm UTC

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Economics

To the extent that the standard of living has increased in the US over the last 30 years, it has mainly been because of technological change. Things that used to cost a lot are cheaper now and...

Latest answer posted April 3, 2012 3:15 am UTC

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Economics

A SARS outbreak in Toronto would reduce both the equilibrium price and quantity exchanged for taxi and limousine services in that city. It would do so by decreasing the demand for those services....

Latest answer posted September 14, 2012 3:25 pm UTC

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Economics

We cannot answer this question with certainty because we do not know enough about these two organizations. Therefore, it is likely that your instructor is asking you this question to try to get...

Latest answer posted September 24, 2012 4:38 pm UTC

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Economics

The "purchasing power parity" also referred to as the "the law of one price," states that the exchange rate between currencies of two nations is determined by the price levels prevailing in the...

Latest answer posted April 9, 2012 3:09 am UTC

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Economics

The impact on the economy would be very negative assuming that the attack was both widespread and successful. The reason for this is that people's confidence in the banking system (and in much of...

Latest answer posted February 1, 2012 11:18 am UTC

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Economics

A free market system works to the advantage of everyone only when the possibility of a small group of participants manipulating the system to their advantage does not exist. In developing...

Latest answer posted February 27, 2012 10:32 pm UTC

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Economics

Market value is a value that can be measured in price. The price is found when a thing is sold on the market. But some things are public goods and cannot be sold. This means that there is no way...

Latest answer posted March 15, 2012 2:46 am UTC

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Economics

The data from the table in your link show us that the profit-maximizing output for the firm is 500 kg. This can be determined in two ways. First, there is the total revenue - total cost method....

Latest answer posted September 25, 2012 3:06 pm UTC

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Economics

Two possible negative consequences of rapid growth of GDP are rising inequality and the breakdown of traditional societal ways. When GDP rises rapidly, there are typically winners and losers. We...

Latest answer posted October 2, 2012 6:08 am UTC

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Economics

Many things determine the price of oil, but the most basic force that is currently driving up the price of oil is the fact that demand is expanding relative to supply. This is especially true...

Latest answer posted November 25, 2012 10:43 pm UTC

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Economics

First of all, it is important to note that we in the United States are not, so far as we know, in a recession today. The deep recession began in December of 2007 and lasted until June of 2009. It...

Latest answer posted February 11, 2013 6:18 pm UTC

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Economics

There are three definitions that are used to measure the supply of money. They are known as M1, M2, and M3. M1 is the narrowest definition, including only the most liquid forms of money. It...

Latest answer posted June 9, 2012 7:08 pm UTC

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Economics

I will not use the terms “liberal” and “conservative” in this answer because I do not think that attitudes on free trade divide very well into liberal and conservative points of view. For example,...

Latest answer posted November 16, 2013 11:58 pm UTC

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Economics

What you are talking about here is the quantity theory of money. One way to state the basic equation of this theory is to say that Money growth + velocity growth = inflation + Real GDP growth If...

Latest answer posted February 17, 2012 4:26 am UTC

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Economics

Inflation is one factor that shows the health of the overall macroeconomy. The higher the level of inflation, the less healthy the economy is. Inflation can occur, for example, when a country's...

Latest answer posted July 15, 2012 1:12 pm UTC

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Economics

The Overshooting Model is a theory proposed by Rudi Dornbusch, who claimed that the "sticky" nature of money and goods prevented markets from adapting immediately to changes in the value and supply...

Latest answer posted December 13, 2011 11:52 am UTC

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Economics

There are typically said to be five things that can change supply. Please note that the price for which the good or service can be sold is not something that can change supply. It cannot move the...

Latest answer posted May 20, 2013 9:55 pm UTC

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Economics

The impact of unskilled immigrants on the American economy is the source of a great deal of controversy. Conventional wisdom holds that such immigrants do drag the US economy down. Some economic...

Latest answer posted February 13, 2013 2:40 pm UTC

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Economics

A swap is a general term used in the field of finance that refers to an exchange of cash flows generated by two different assets which usually lie in the same category, in the case of relatively...

Latest answer posted May 24, 2011 10:50 pm UTC

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Economics

Yes, we can say this. In fact, we can say that any firm will maximize its profits when it produces its product at the quantity where its marginal costs are equal to its marginal revenues. This...

Latest answer posted April 22, 2012 5:15 pm UTC

1 educator answer

Economics

It is impossible to know this for sure without knowing details of the particular plan. However, I would argue that the problems would outweigh the gains. The benefit of such a program would be a...

Latest answer posted November 27, 2011 12:10 pm UTC

1 educator answer

Economics

Simply put, supply and demand is a function of how much of a product is available, how it is priced, how many people have adequate resources to purchase said product, and how many of them actually...

Latest answer posted July 20, 2012 3:33 am UTC

1 educator answer

Economics

The correct answer here is the demand curve. The law of diminishing marginal utility helps tell us why the demand curve slopes downward. The law of diminishing marginal utility tells us each unit...

Latest answer posted July 31, 2016 4:17 pm UTC

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Economics

A market economy is an economy in which consumers decide the answers to the three fundamental economic questions. These questions are what to make, how to make it, and for whom to make it. In a...

Latest answer posted November 2, 2012 2:47 am UTC

1 educator answer

Economics

In order to do this, you would need to have the consumer price index (CPI) for your starting year and your ending year. You would need to be sure that these CPIs were using the same base year so...

Latest answer posted December 11, 2012 5:26 pm UTC

1 educator answer

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