If an excise tax is imposed on shoes,
a. government tax revenue will fall
b. the market price of shoes will decrease
c. the supply curve will shift downward
d. the equilibrium quantity demanded will decrease
e. the equilibrium quantity supplied will increase
D
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Comment on the following statement: "An increase in the wage always leads to an increase in the quantity of labor supplied."
What will be an ideal response?
Refer to Figure 14-7. Uniguest, Inc is a company that provides PCs with internet access and touch-sensitive screens to hotels
Suppose the Hard Rock Hotel and Casino in Las Vegas informs Uniguest that it is considering installing these systems in its hotel rooms. The Hard Rock expects to be able to charge higher prices for these rooms if it installs Uniguest's systems in its rooms. The two companies begin bargaining over what price the Hard Rock will pay Uniguest for its systems, and the decision tree shown above illustrates this bargaining game. Note that the profit figures listed in the decision tree are additional profits for the Hard Rock and total profits for Uniguest. a. Suppose the Hard Rock offers Uniguest $1,200 per system. Will Uniguest accept or reject this offer? Why? b. Suppose the Hard Rock offers Uniguest $800 per system. Will Uniguest accept or reject this offer? Why? c. Suppose Uniguest attempts to obtain a favorable outcome from the bargaining by telling the Hard Rock it will reject an $800-per-system offer. If the Hard Rock does not believe the threat is credible, what will it do? Why? What will Uniguest do? Why? d. Is there a subgame-perfect equilibrium in this situation? Explain.
In the short run in the Keynesian model, a sharp increase in oil prices would leave the economy with a ________ level of output and a ________ real interest rate
A) higher; lower B) lower; higher C) lower; lower D) higher; higher
Given two economic systems, A and B, if economy A has an absolute advantage in the production of widgets, then
A) fewer inputs are necessary to produce widgets in economy A than in economy B. B) economy A must give up less of all other goods to produce widgets than economy B. C) economy A is less efficient in the production of widgets than economy B. D) economy A would not benefit from the specialization of production.