Give an example that shows why sellers use the market price in a perfectly competitive market.
What will be an ideal response?
but should show why sellers use the market price in a perfectly competitive market. For example, Trung is a farmer who sells his produce to supermarkets and other stores. There are many other farmers who sell produce of identical quality. So if Trung charges more than the market price, the stores could easily go to other farmers and buy produce more cheaply at market price. Also, Trung can sell as much as he wants at market price. Because of this, he wouldn’t charge less than the market price.
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If the savings rate in an economy is 30%, and the level of investment in the economy is $400, the GDP of the economy must be:
A) $1,900.25. B) $1,111.22. C) $1,333.33. D) $1,750.50.
You are the new vice president in charge of advertising at Taco Bell. In your upcoming advertising campaign, you plan to degrade the fast food competitor whose product is the closest substitute for Taco Bell's tacos
That would be the fast food chain whose cross elasticity of demand with your tacos is equal to A) negative 2.11. B) negative 1.75. C) positive 1.55. D) positive 1.00.
Think of the speculative motive for holding money: As the interest rate decreases from 10 percent to 5 percent, the quantity of money people will hold
a. decreases by some quantity, but not necessarily by 50 percent b. increases by some quantity, but not necessarily doubles c. remains unchanged d. doubles e. falls by 50 percent
Externalities are created when parties not involved in an economic transaction are affected by it
a. True b. False Indicate whether the statement is true or false