What role do households play in output markets? What role do households play in factor markets?
What will be an ideal response?
Households are the buyers in output markets and are the sellers in factor markets.
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When the Fed lowers the federal funds rate and the real interest rate falls, what happens to the opportunity cost of investment? What happens to investment?
What will be an ideal response?
A straight-line demand curve with negative slope intersects the horizontal axis at 200 tons per week. The point on the demand curve at which the price elasticity of demand is 1 corresponds to a quantity demanded
A) of 0 tons. B) of 100 tons. C) of 200 tons. D) that would be negative if a negative quantity demanded were possible.
Let's assume that two countries have imposed high tariffs on each other's products and services to the point where all trade between the two countries has disappeared
Assume a newly elected member of parliament in one of the countries makes a proposal for unilateral tariff reduction regardless of whether the other country wishes to follow suit. Explain why such a policy change would actually be a good idea.
The demand for a movie ticket is probably _________________ than is the demand for a Broadway show ticket because ______________.
A. less price elastic; a movie ticket requires a smaller portion of one's income. B. more price elastic; a movie ticket requires a smaller portion of one's income. C. less price elastic; a movie ticket has fewer available substitutes. D. more price elastic; a movie ticket has fewer available substitutes.