Why is the effect of a change in price of a substitute good potentially ambiguous?
What will be an ideal response?
A change in price of a substitute good for a resource has two effects. First, there is a substitution effect where a firm will use more or less of a substitute good relative to the resource depending on whether the price of the substitute falls or rises. Second, there is an output effect where the firm will use more of the resource because the substitute resource has declined in price or vice versa. Since these effects move in opposite directions the total effect is unclear.
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All of the following are considered to be unemployed EXCEPT
A) job leavers. B) discouraged workers. C) job reentrants. D) new job entrants.
The late business historian Alfred Chandler blamed Britain's competitive difficulties in the early twentieth century on:
a. the structure of the firms. b. the removal of trade barriers. c. the lack of innovation. d. inefficient transfer of information within firms.
Representative money is
a. accepted on faith. b. found in M1 and M2 money measures. c. today in the form of check able deposits. d. redeemable for a commodity.
In 1950, the country with the highest per-capita GDP was
A) Switzerland. B) New Zealand. C) the United States. D) Venezuela. E) the Netherlands.