It has been said that "economics is the science of common sense." Is economics synonymous with common sense?
A large portion of economics will agree with common sense, such as higher prices leading to a cutback in purchases or more government spending creating jobs. But economic logic provides findings that may conflict with a non-economist's common sense, such as tariffs and quotas costing, rather than creating, jobs. Economics may be the science of common sense, but that common sense must include a logical way of thinking.
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If a typical monopolistically competitive firm is making short-run losses, then
A) as some firms leave, the demand for the products of the remaining firms will become more elastic. B) other more competitive firms will enter the market. C) as some firms leave, the remaining firms will experience an increase in the demand for their products. D) the industry will eventually cease to exist.
Why may the debt crisis be only "sleeping" rather than "dead?"
What will be an ideal response?
Under rent control, tenants can expect
a. lower rent and higher quality housing. b. lower rent and lower quality housing. c. higher rent and a shortage of rental housing. d. higher rent and a surplus of rental housing.
Which of the following make(s) demand for U.S. dollars in the market for foreign-currency exchange higher than otherwise?
a. a U.S. airline wanting to buy jets made in France and a Swedish hospital wanting to buy medical equipment made in the U.S. b. a U.S. airline wanting to buy jets made in France, but not a Swedish hospital wanting to buy medical equipment made in the U.S. c. a Swedish hospital wanting to buy medical equipment made in the U.S., but not a U.S. airline wanting to buy jets made in France d. neither a U.S. bank wanting to lend money to a Canadian company nor a U.S. firm wanting to buy computers made in South Korea