Explain how each of the following limits the economic growth of developing nations:
(a) Insufficient capital formation
(b) A shortage of human resources
(c) A lack of social overhead capital
(a) If there is insufficient capital formation, then capital stock does not grow and output in the future will be reduced. A lack of capital also reduces the productivity of labor.
(b) A shortage of human resources may be a barrier to growth because this reduces productivity. Also, foreign companies will not invest in countries that do not have a trained labor force.
(c) A lack of social overhead capital makes countries less able to attract private investment. A lack of social overhead capital also increases the difficulty of transporting food throughout the country, which worsens the food shortage.
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Refer to Figure 9.3. If the government establishes a price ceiling of $1.00, how many pounds of berries will be sold?
A) 200 B) 300 C) 400 D) 600 E) 800
Skippy loves peanut butter. Skippy reads on the internet that 75 percent of the peanut crop in the South has been wiped out by drought, and that this will cause the price of peanuts to more than double by the end of the year. As a result, a. Skippy's demand for peanut butter will increase, but not until the end of the year. b. Skippy's demand for peanut butter increases today
c. Skippy's demand for peanut butter decreases as he considers buying almond butter. d. Skippy's demand for peanut butter shifts left today.
An economist estimates that for every 1 percent increase in the price of natural Christmas trees, the demand for artificial trees rises by .2 percent. From this information one can conclude that:
A. the income elasticity of demand for natural Christmas trees is less than 1. B. natural and artificial Christmas trees are complements. C. natural and artificial Christmas trees are substitutes. D. natural Christmas trees are luxuries.
At a given output level, a monopolist earns a profit only if the
A. slope of its TR curve exceeds the slope of his or her TC curve. B. height of its MR curve exceeds the height of his or her MC curve. C. height of its demand curve exceeds the height of his or her MR curve. D. height of its demand curve exceeds the height of his or her ATC curve.