Suppose domestic beef producers face demand of QD = 1000 - 5P. Suppose the Chinese acquire a taste for U.S. beef such that their demand is QD = 500 - 5P. Market demand is now
a. 1000 - 10P for all P
b. 1500 - 10P for all P
c. 1500 - 5P for all P
d. 1000 - 5P for P > 100 and 1500 - 10P for P < 100
d
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When tastes over current and future consumption are characterized by Cobb-Douglas utility functions, a borrower who has no income now and all income in the future will borrow more when the interest rate falls.
Answer the following statement true (T) or false (F)
What is a minimum wage and what are its effects if it is set above the equilibrium wage?
What will be an ideal response?
A decrease in the growth rate of labor productivity is likely to cause a decrease in ________
A) the growth rate of the real wage B) the growth rate of the marginal product of capital C) the growth rate of the labor supply D) the share of labor income in national income E) none of the above
A market has four individuals, each considering buying a grill for his backyard. Assume that grills come in only one size and model. Abe considers himself a grill-master, and finds a grill a necessity, so he is willing to pay $400 for a grill. Butch is a meat-lover, honing his grilling skills, and is willing to pay $350 for a grill. Collin just met the girl of his dreams, and she loves a good grilled steak, so in his effort to impress her he is willing to pay $320 for a grill. Daniel loves grilled shrimp and thinks it might be cheaper in the long run if he buys a grill instead of eating out every time he wants grilled shrimp, so he is willing to pay $200 for a grill.
If the market price of grills increases from $300 to $325, given the scenario described: A. Collin would drop out of the market. B. Collin's surplus would decrease the most. C. Collin is the only consumer who would be affected in terms of surplus. D. Daniel’s surplus would decrease.