One model in economics is the permanent income hypothesis, which basically states that a household's expenditures will not react to a change in income unless that change in income is viewed as being permanent
How would you use this model to predict the expenditure patterns over the course of a year of a real estate agent who only sells homes during the months of April through July?
The agent will not consume all of her income when it is earned. She knows that her paychecks will not be coming during August through March. As a result, some of her summer income will be saved for use during those months.
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According to the search model, the marginal benefit of acquiring information about a product
a. is greater for a doctor than a nurse's aide b. is the same for high-income consumers as for low-income consumers c. is greater for expensive items than for cheap items d. is greater for cheap items than for expensive items e. increases as more information is acquired
Has the worry that international trade will cause horrible environmental conditions as companies rush to build factories in countries with low environmental regulation come true?
a. No, multinational companies have built factories to the standards in developed countries. b. No, multinational companies have not built factories in countries with low environmental regulations. c. Yes, multinational companies build factories that pollute much more than their factories in developed countries. d. Yes, multinational companies move their companies to countries with the lowest environmental regulations.
According to new trade theory, the first mover's ability to benefit from increasing returns ______ for other firms.
Fill in the blank(s) with the appropriate word(s).
Suppose a drought in australia has seriously impaired agricultural productivity. how would that impairment in productivity affect short-run aggregate supply?