Explain how the combination of major changes in the weather and price inelasticity of demand for a food item can lead to wide fluctuations in a farmer's income from year to year
Major changes in the weather can impact the supply of an agricultural product. If the weather is favorable, the supply curve for the crop will shift to the right, lowering the price of the crop. If the weather is unusually bad, the supply curve for the crop will shift to the left, raising the price of the crop. In addition, if demand for the product is inelastic, then quantity demanded will not change very much in relation to any given price change. Thus, if unusually good weather leads to a large decrease in the price of the crop, the quantity demanded will not change by a very large percentage, and the farmer's total revenue will drammatically decrease. On the other hand, if unusually bad weather raises the price of the crop substantially, there will be a relatively small decrease in quantity demanded, and the farmer's total revenue will drammatically rise.
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In 2013, the reference base period for the CPI for the nation of Webot, a typical consumer spent $30 on potatoes and $150 on steak
If the price of steak is $15 and the price of potatoes is $1 then there are ________ units of steak and ________ units of potatoes in the CPI market basket. A) 10; 30 B) 150; 30 C) 5; 30 D) 30; 150 E) None of the above answers is correct.
Which of the following will increase economic freedom?
What will be an ideal response?
If the real U.S. GDP was $10 trillion in 2000 and the U.S. population was 280 million, the per capita real GDP would have been closest to
A. $35,714 per person. B. $28,000 per person. C. $2,800 per person. D. $5,000 per person.
To close a recessionary gap using fiscal policy, the government can:
A. increase government spending by the size of the gap. B. decrease government spending by the size of the gap. C. increase government spending by more than the size of the gap. D. increase government spending by less than the size of the gap.