With the additional leakages of imports and taxes in additional to savings in a public, open economy, how is the economy still able to reach equilibrium?
What will be an ideal response?
The additional leakages are balanced by additional injections. The injections include exports and government purchases, in additional to investment. All of these activities increase the total level of expenditures to counteract the additional drain from imports, taxes and savings.
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Many restaurants offer "early-bird specials" to dinner customers. These specials consist of a significant price reduction on selected menu items purchased before some pre-determined time, e.g., 6 p.m
Is such a practice a form of price discrimination? If so, what type?
A good economic theory: a. rests on realistic assumptions
b. explains economic behavior and predicts well. c. can best be expressed mathematically. d. always provides a highly detailed analysis of an economic sector.
The income elasticity of demand for a good that is extremely necessary for the existence of its consumers is close to zero
a. True b. False Indicate whether the statement is true or false
Hudson Manufacturing is an MNE based in the United States with operations in Asia. The firm is considering expansion into the European Union. Executives at the firm are debating whether central Europe or Eastern Europe would be best for the firm. Which of the following best supports a decision to establish operations in Eastern Europe?
A) Hudson wants to implement a high-performance work system. B) Hudson plans to staff the foreign facility with local managers. C) Hudson wants to minimize costs by keeping wages low. D) Hudson recently lost money in a joint venture.