Why is money you receive at some future date worth less to you than money you receive today?
What will be an ideal response?
Money received at some future date is worth less than money received today because if you have the money today, you can use it today to buy goods and services and receive enjoyment from them. In addition, prices are likely to rise, so money received later won't buy as much. Finally, there is some risk that you will not receive the money in the future.
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The PPP theory fails in reality for all of the following reasons EXCEPT
A) transport costs. B) monopolistic or oligopolistic practices in goods markets. C) the inflation data reported in different countries are based on different commodity baskets. D) restrictions on trade. E) inflation rates are unrelated to money supply growth.
Suppose Tucker Inc is willing to sell one gizmo for $10, a second gizmo for $15, a third for $20, and the market price is $25 . What is Tucker Inc's producer surplus?
a. $10 b. $15 c. $30 d. $50
The analysis of oligopolistic behavior is difficult because
A. there are few real-world examples of oligopolies for economists to study. B. oligopolists make decisions independently of each other. C. firms in oligopolistic industries react to each other’s behavior in many ways. D. economists have paid little attention to the topic in recent years and so have not yet applied to it the techniques of modern economic theory.
Because of its ___________ effects, inflation increases social and economic tensions.
Fill in the blank(s) with the appropriate word(s).