Mike went to a shop to buy a pair of gloves. Who will have a higher bargaining power if the seller knows that Mike needs the gloves urgently?
What will be an ideal response?
The seller will have a higher bargaining power if he knows that Mike needs the gloves urgently. This is because he knows he can get away with charging a higher price because Mike does not have the time to check for other deals available in the market.
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Refer to Figure 15-15. Why won't regulators require that Erickson Power produce the economically efficient output level?
A) because at the economically efficient output level, the marginal cost of producing the last unit sold exceeds the consumers' marginal value for that last unit B) because Erickson Power will earn zero profit C) because there is insufficient demand at that output level D) because Erickson Power will sustain persistent losses and will not continue in business in the long run
Marginal utility per dollar spent on good X is
a. total utility of X divided by its price. b. marginal utility of X divided by its price. c. the change in marginal utility of good X. d. none of the above
Lack of economic success in many African countries can be attributed to
a. excessive money supply growth b. too-rapid market liberalization c. weak social institutions d. too much state control over agricultural production e. all of the above
Suppose that the Fed purchases a $1,000 government bond from you. If you deposit the entire $1,000 in your bank, what is the total potential change in the money supply as a result of the Fed’s action if reserve requirements are 10 percent?
A. $10,000 B. $5,000 C. $3,000 D. $2,000