Tom and Eric went to trade school at the same time. Each graduated with an associate's degree. They have received similar performance evaluations. Eric's employer is not a good business manager, and the sales manager lost a major deal. Because of the decrease in profits, the employees did not receive raises last year. Tom's employer is a savvy business manager and the sales manager is experienced
and works hard. If Tom has higher earnings than Eric, the difference is most likely a function of
a. chance.
b. differences in human capital.
c. differences in signaling.
d. discrimination.
a
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Specialization of labor makes sense only if there is some means of exchange.
Answer the following statement true (T) or false (F)
The data show Argentina's GDP (using purchasing power parity) in billions of dollars
Year 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 GDP($) 182 209 235 255 277 274 294 324 340 333 338 330 300 Year 2003 2004 2005 2006 GDP($) 333 373 420 470 The data show that A) Argentina's economy was in a recession from 2004 through 2006. B) Argentina's economy was in a recession in 2001 and 2002. C) GDP per person more than doubled between 1990 and 2006. D) Argentina's economy reached a peak in 1996.
When the FDIC took over the Chicago-based Continental Illinois Bank, it
a. refused to guarantee any of the bank's deposits even though the bank was insured by FDIC because the bank had engaged in illegal practices b. covered its deposits before allowing the bank to be taken over by the Treasury c. allowed Continental to fail in order to set an example to other banks that engaged in overly risky loan ventures d. sold Continental at a bargain price to Citibank e. announced it would cover every deposit—without limit—to keep Continental alive
If an oligopoly market is contestable and new firms enter, the
A. Number of firms in the industry will decrease. B. Market power of the former oligopolists will be reduced. C. Profitability of the industry will increase. D. Former oligopolists will raise their prices.