Explain how the volunteer's dilemma is a special case of the public goods problem in which the possibility exists that no one will end up providing the public good
What will be an ideal response?
The Volunteer's dilemma is a situation in which a single person can provide a public good. Because everyone benefits when the good is provided, and therefore property rights are not well defined, individuals face tension between their desire to see the good provided and and their desire to have someone else provide the good. This tension and the strategic behavior it causes create the possibility that no one will provide the good.
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Refer to the scenario above. Suppose the cost of advertising in this industry is very high and each company will incur a cost of $3 million annually if they choose to advertise. Which of the following is true in this case?
A) Company A's best response is to advertise if Company B advertises. B) Company B's best response is to advertise irrespective of what Company A does. C) Company A's dominant strategy is to advertise. D) This game does not have a dominant strategy equilibrium.
According to the theory of structural patterns of development, which of the following tends to occur as a country develops?
a. a shift from agriculture to industry and services b. an increase in the percentage of income spent on food c. growth of the rural sector d. a decline in trade as a share of GNP
Briefly discuss different methods of allocating quota licenses to the importers by the government. Also explain the inefficiency implications of each method.
What will be an ideal response?
Compare the features of the classical economic model to the Keynesian economic model. How do these models influence the aggregate demand curve and the aggregate supply curve? Which model, in your opinion, benefits the economy in the long run?