A price floor has no effect in a market when it's set
a. above the equilibrium price
b. below the equilibrium price
c. at 100 percent of parity
d. above the price ceiling
e. below the price ceiling
B
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In 2009, Samoa changed from everyone driving on the right side of the road to everyone driving on the left side of the road. Although everyone agreed that it was important to drive on the same side of the road, some Samoans were not happy about the change. This created a disagreement about which Nash equilibrium was the best equilibrium, and therefore represented
A) an assurance game. B) a pure coordination game. C) a battle of the sexes game. D) a prisoner's dilemma game.
Jose consumes wallets (q1 ) and a composite of other goods (q2 ). The price of wallets is p1 and the price of other goods is p2 = 1
Jose's utility from wallets depends also on his income—with a higher income, he values a wallet more because he has more to put inside it! His utility is given by the equation U(q1,q2 ) = q1Yq2 Derive Jose's demand for wallets.
The long run significance of investment is due to
a) its volatility b) the importance of capital to economic growth c) the effect of income on investment d) the procyclical nature of investment e) its ability to crowd-out government expenditures
Given two economic systems, A and B, if economy A has a comparative advantage in the production of widgets, then
A. economy A would not benefit from the specialization of production. B. economy A must give up less of all other goods to produce widgets than economy B. C. economy A is less efficient in the production of some goods than economy B. D. the inputs necessary to produce widgets in economy A cost less than in economy B.