Suppose the government changes the tax code so that it is much simpler-there are fewer rules, fewer deductions, and fewer calculations to perform. Describe, using a supply and demand diagram, what would happen in the market for tax accountants.
What will be an ideal response?
The labor demand curve for tax accountants would shift to the left, reducing the equilibrium wage for accountants and decreasing the equilibrium quantity.
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When the price of hot dogs at the supermarket increases, the quantity demanded of hot dog buns declines. This situation describes:
a. the income elasticity of demand for hot dogs. b. the income elasticity of demand for hot dog buns. c. the price elasticity of supply for hot dogs. d. the negative cross-price elasticity of demand for hot dogs and hot dog buns. e. the positive cross-price elasticity of supply for hot dogs and hot dog buns.
In the long run, even if new fringe firms enter the oligopoly market, the dominant firm's profit will remain unaltered
Indicate whether the statement is true or false
Potential GDP refers to the quantity of output that an economy can produce with full employment of its labor and physical capital
a. True b. False Indicate whether the statement is true or false
If your income elasticity of demand for hot dogs is negative, then:
A. hot dogs are an inferior good for you. B. your demand curve for hot dogs is not downward sloping. C. hot dogs have no close substitutes for you. D. you must not enjoy eating hot dogs.