Explain why the supply-and-demand model should not be used to analyze the market for jeans
What will be an ideal response?
Products in the jeans market are not identical (at least not in the consumers' eyes). The fact that there is only one manufacturer per brand gives that particular firm (limited) power over the price of its product. Thus, two conditions for the use of the model are not fulfilled.
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Suppose the typical household holds $1,000 when the interest rate is 5 percent. When the interest rate rises to 6 percent, the typical household would most likely hold
A) more money because the opportunity cost of holding money is higher. B) less money because the opportunity cost of holding money is lower. C) less money because the opportunity cost of holding money is higher. D) more money because the opportunity cost of holding money is lower.
Disease, poor nutrition, and substandard health care in developing nations can reduce growth in an economy by
A) reducing physical capital. B) reducing human capital. C) increasing technological change. D) increasing labor productivity.
If a monopolist lowers its price
A) it lowers the barriers to entry. B) the quantity demanded increases. C) the quantity demanded remains the same. D) the quantity demanded decreases.
In the United Sates, the average annual rate of growth of real wages was fastest in the period:
A. 1960-1973. B. 1960-1995. C. 1973-1995. D. 1996-2010.