What is the loanable funds market? What happens if the real interest rate in the market is held above the equilibrium interest rate?
What will be an ideal response?
The loanable funds market is the market where borrowers obtain funds from savers.
In such a market, if the real interest rate is held above the equilibrium interest rate, the quantity of credit supplied will exceed the quantity of credit demanded. This will create a downward pressure on the real interest rate.
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A monopoly is a market with one
a. seller, and that seller is a price taker. b. seller, and that seller sets the price. c. buyer, and that buyer is a price taker. d. buyer, and that buyer sets the price.
Suppose that for Halim, the marginal utility of a baseball bat is 50 utils, the marginal utility of a tennis racket is 40 utils, and the marginal utility of an official NFL football is 30 utils. The baseball bat is $35.00, the tennis racket is $200, and the football is $100.00. What can you conclude from this information?
a. Halim will be more inclined to purchase a baseball bat. b. Halim will be more inclined to purchase a tennis racket. c. Halim will be more inclined to purchase a football. d. Halim is in consumer equilibrium regarding the three types of sports equipment.
Smyth Industries operated as a monopolist for the past several years, earning annual profits amounting to $50 million, which it could have maintained if Jones Incorporated did not enter the market. The result of this increased competition is lower prices and lower profits; Smyth Industries now earns $10 million annually. The managers of Smyth Industries are trying to devise a plan to drive Jones Incorporated out of the market so Smyth can regain its monopoly position (and profit). One of Smyth's managers suggests pricing its product 50 percent below marginal cost for exactly one year. The estimated impact of such a move is a loss of $1 billion. Ignoring antitrust concerns, compute the present value of Smyth Industries' profits, if it could have remained a monopoly when the interest rate
was 5 percent. A. $200 million B. $100 million C. $1.05 billion D. $210 million
?19742015Minimum wage per hour$ 2.00$ 7.25Weekly income from minimum wage$80.00$290.00Cost of a standard basket of goods$47.00$236Number of baskets per week1.701.23
Use Table 2.5 above to answer the question. By what percentage did the federal minimum wage increase between 1974 to 2015?
A. 72.41 percent B. 262.5 percent C. 362.5 percent D. 525.0 percent