Supplier Power Nora's Nicest Knick Knacks has produces a variety of products sold as souvenirs. She started out printing local sayings on tee-shirts, e.g., FDNY, and purchased plain tee-shirts from a single supplier. Since then, she has added coffee
mugs, key chains, souvenirs spoons and many other items. For each of these, she has lined up one or more suppliers. How does the change in the sourcing of her inputs affect how much of the value she creates that she gets to capture?
Nora's purchases used to be concentrated with a single supplier. This means she had to take whatever deal they were offering or go out of business. But over time, she has added more suppliers and is less dependent on any one. This means she can still have sales and production of some items even while she is negotiating with suppliers for another. This means she will tend to capture more of the value her firm creates.
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In the above figure, if the price is $8 then there is a
A) surplus of 100. B) surplus of 200. C) shortage of 100. D) shortage of 200.
If the central bank targets a rate of nominal GDP growth, then it would have to _____ money growth when nominal GDP fell below its target in order to _____ inflation and ____ real GDP
a. increase; increase; increase b. increase; decrease; decrease c. decrease; decrease; decrease d. decrease; decrease; increase
Suppose the economy is in equilibrium when there is a change in environmental policy that bans all pesticides and herbicides on farmland. We would expect to observe
A) a decrease in aggregate supply and an increase in aggregate demand. B) a decrease in both real output and the natural rate of unemployment. C) a decrease in real output and an increase in the natural rate of unemployment. D) a decrease in real output and an increase in the price level.
The purchase by consumers of inventory converts that inventory from investment goods to consumption goods
Indicate whether the statement is true or false