What are the three main problems that make economics an inexact science? How are these problems similar? What causes this similarity?
What will be an ideal response?
The three main problems that make economics inexact are the following: 1) inability to predict how the economy will change; 2) inability to know how and when policies should be implemented; and 3) inability to know how long a policy will take to have an effect. All three of these problems deal with an uncertainty about the future. The main reason for this uncertainty is that economists cannot predict exactly how businesses and households will react to various economic situations. For example, they don’t know exactly how firms will react to an implementation of a policy. Because of this, economists don’t know when and how strongly a policy should be executed. Also, economists cannot predict major events, such as wars and disasters, that might significantly affect the economy.
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The number of people receiving Medicare coverage is expected to ________ by the year 2025
A) reach 5 million by B) stabilize C) grow to 74 million D) decline by 10 percent
What does each point on the production possibilities curve represent? (check all that apply)
a. Inefficiency in production b. Efficiency in production c. The maximum output of two products d. The maximum output of many products
Which of the following is NOT an example of price discrimination?
A) student discount at a local movie theater B) breakfast cereal makers sending coupons to select buyers C) Pharmaceutical companies charge customers living in wealthier countries higher prices than for identical drugs in poorer nations. D) a hard cover book selling for more than the same book in electronic form
If the price elasticity of supply for computers is 0.8 in the short run, then in the long run we would expect a price elasticity of supply to be greater than 0.8
Indicate whether the statement is true or false