The economist John Kenneth Galbraith (1979) lists several major sources of weakness in the economy that laid the groundwork for the collapse of the 1930s. These sources include all of the following except
(a) A weak banking structure
(b) Ignorance of the economy's problems by the nation's leaders
(c) An overgrown federal bureaucracy with extensive regulation of the private economy
(d) An increasingly unequal distribution of income
(c)
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If the production technology in a Robinson Crusoe economy has increasing returns to scale, there is no production/consumption plan that is efficient.
Answer the following statement true (T) or false (F)
If a 10 percent increase in income results in an 8 percent increase in the quantity demanded of a good, the income elasticity of demand equals ________ and the good is ________ good
A) 0.80; an inferior B) 1.2; a normal C) 0.80; a normal D) -1.2; an inferior
Demand is given by QD = 6000 - 50P. Domestic supply is QS = 25P. Foreign producers can supply any quantity at a price of $40
a. If foreign producers can sell in the domestic market, what is the equilibrium price? What is the equilibrium quantity? How much is sold by domestic and foreign producers, respectively? b. Under domestic government pressure, foreign producers voluntarily agree to restrict their goods. What will happen to the price and quantity? What will happen to the amount that domestic producers supply? What will happen to revenues of domestic and foreign producers?
"Dumping" means destroying goods to prevent driving down the price
a. True b. False Indicate whether the statement is true or false