For which of the following goods is the income elasticity of demand likely lowest?
a. subscriptions to premium movie channels through the local cable television provider
b. hi-definition DVD players
c. champagne
d. housing
d
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Frank Banks manufactures and sells piggy banks in a perfectly competitive market. The firm recently purchased new equipment with an expected rate of return of 7 percent
If the market rate of interest is 8 percent, was the firm's decision to purchase the equipment a wise one? Explain.
Consider two countries, Alpha and Beta. In Alpha, real GDP per capita is $6,000. In Beta, real GDP per capita is $9,000
Based on the economic growth model, what would you predict about the growth rates in real GDP per capita across these two countries? A) The growth rate of real GDP per capita in Alpha and Beta will be the same. B) The growth rate of real GDP per capita will be higher in Alpha than it is in Beta. C) The growth rate of real GDP per capita will be lower in Alpha than it is in Beta. D) The economic growth model makes no predictions regarding differences in growth rates of real GDP per capita across the two countries.
Government regulations, such as zoning laws, can act as
A. the Big Squeeze. B. barriers to entry. C. marginal costs. D. long-term costs.
In the product market, changes in technology affect the marginal ________ of a unit of output. In the labor market, changes in technology affect the marginal ________ of a unit of labor input.
A. cost; cost B. revenue product; cost C. cost; revenue product D. revenue; revenue