When observing economic growth and literacy rates, it is clear that:
a. economic growth causes higher literacy rates
b. economic growth may be a consequence of improved education.
c. improved levels of education may be the result of increasing economic growth.
d. all of the above are likely to be true.
d
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Sometimes economists disagree because their scientific judgments differ. Which of the following instances best reflects this source of disagreement?
a. One economist believes everyone should pay the same percentage of their income in taxes; another economist believes that wealthier citizens should pay a higher percentage of their income in taxes. b. One economist believes that manufacturing firms should face greater regulation to preserve the environment; another economist believes the government should not intervene in free markets. c. One economist believes that equality should be valued over efficiency in policy decisions; another economist believes that efficiency should be valued over equality in policy decisions. d. One economist believes the government should tax a household's income; another economist believes the government should tax a household's consumption.
Why is there a significant difference in the pay of physicians and construction workers?
What will be an ideal response?
You are in the market for a used 2016 Toyota Corolla. You know that half of the 2016 Corollas are lemons and half are peaches. If you could be assured that the Corolla you were buying was a peach, you would be willing to pay up to $12,000. On the other hand, you would only be willing to pay $4,000 for a lemon. You have no ability to discern whether any particular Corolla is a lemon or a peach. Sellers of Corollas, on the other hand, are likely to know whether their particular car is a lemon or a peach. Suppose sellers of lemons will sell their cars for $3,000 or more and peach sellers will be willing to sell their cars for $9,000 or more. If you are risk neutral, you are willing to offer ________ and ________ are willing to sell you their car.
A. $4,000 for a car of unknown quality; lemon owners only B. $6,000 for a car of unknown quality; lemon owners only C. $8,000 for a car of unknown quality; lemon owners only D. $9,000 for a car of unknown quality; both lemon and peach owners
Value added by a firm is the market value of the firm's output minus the:
A. Total wages paid to its employees B. Value of inputs bought from other firms C. Profits that the firm's owners earn D. Total costs of all inputs used