Consider the market for iPods. What happens if a fantastic new alternative MP3 player is developed and at the same time a boat carrying a large shipment of iPods is attacked by pirates and sunk?
What will be an ideal response?
The change in price is indeterminate and quantity decreases.
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The purpose of the "draft" developed by owners' associations in many professional sports is to
A) assure all players at least a minimum salary. B) control competition among owners for the services of players. C) control competition among players. D) control competition between players and owners. E) keep all teams at roughly equal competitive levels.
Because the value of marginal product diminishes as the quantity of labor employed increases, the ________ the wage rate, the ________ workers the firm hires
A) lower; more B) higher; more C) lower; fewer D) None of the above answers is correct because there is no relationship between the wage rate and the number of workers hired.
The most that someone would pay today to receive a certain sum at some point in the future is known as
A) the interest rate. B) present value. C) future value. D) economic profit.
Define the following terms and explain their importance to the study of macroeconomics:
a. aggregation b. recession c. gross domestic product d. final goods and services e. stabilization policy