Professional football players earn much higher wages than do accountants. Why?
What will be an ideal response?
While being an accountant requires very specialized skills, the effective barriers to entry into the accounting market are lower than those necessary (that is, high athletic skill) to be a successful football player. Other factors, such as desirability of work conditions, may also factor in here.
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In a one-period economic model, the government budget constraint requires that government spending
A) = taxes + transfers. B) = taxes + borrowing. C) > 0. D) = taxes.
Suppose all firms in the market have the same costs as illustrated above. Of the following, which is the most likely action for a manager of the firms to take?
A) Increase the price of their grain.
B) Shut down.
C) Advertise their product.
D) Attempt to keep other firms from entering the market.
The rationing function of prices refers to
A) the situation when government must intervene in a market when there is a large shortage or surplus. B) the synchronization of decisions by buyers and sellers that leads to an equilibrium. C) the synchronization of decisions by buyers and sellers through the direction of government agencies. D) the situation when only the rich get the goods they want.
inflation is
What will be an ideal response?