What is the difference between scarcity and a shortage?
What will be an ideal response?
Scarcity is a situation in which unlimited wants exceed the limited resources available to fulfill those wants. A shortage of a good occurs only if the quantity demanded is greater than the quantity supplied at the current price.
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Of the following four motorists, who is speculating?
A) The one driving on empty, looking for the best gasoline price in town B) The one who fills his gasoline tank believing he has found the lowest gas price around C) The one who fills his gasoline tank on news Iraq has once again invaded Kuwait D) All of the above. E) None of the above.
A network externality refers to a situation where:
A) the value of a product increases as more consumers start to use it. B) firms collude to sell products at a price higher than the equilibrium market price. C) a firm that has control over key resources auctions the resources off to other firms. D) the government interferes to prevent the concentration of market power in the hands of a few firms.
________ is considered a high income country, ________ a developing country, and ________ a newly industrializing country
A) Canada; France; Singapore B) Honduras; New Zealand; South Korea C) Japan; Hong Kong; South Korea D) United States; Somalia; Taiwan
Explain how a firm decides how much in loanable funds it will demand