What is meant by the "vicious cycle of poverty," and what are some of the requirements needed to escape this cycle?
What will be an ideal response?
The vicious cycle is presented in the chapter. Key points include low productivity, low savings, and low investment, perpetuating low productivity. Escaping the cycle may be approached through infusions of capital or new ideas of production and social interaction.
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The ability to produce a good at a lower opportunity cost than others is known as
A) comparative advantage. B) absolute advantage. C) specialization. D) marginal cost production.
If the economy is in a recession, it means that:
A. the short-run equilibrium is to the left of the long-run aggregate supply curve. B. total output is less than potential output. C. the economy is not in long-run equilibrium. D. All of these are true.
If a number greater than the mean (average) of a series of observations is added to the series, the new mean is:
A) greater than the original mean. B) smaller than the original mean. C) same as the original mean. D) either greater or smaller than the original mean depending on the number of observations in the series.
Suppose Always There Wireless serves 100 high-demand wireless consumers, who each have a monthly demand curve for wireless minutes of QdH = 200 - 100P, and 300 low-demand consumers, who each have a monthly demand curve for wireless minutes of QdL = 100 - 100P, where P is the per-minute price in dollars. The marginal cost is $0.25 per minute. Suppose Always There Wireless charges $0.30 per minute. What is the highest fixed fee Always There Wireless could charge without losing the low-demand consumers?
A. $28.13 B. $56.26 C. $24.50 D. $49.00