Discuss how the market failure that arises from between externalities differ from market failure that arises from goods. Describe two methods for correcting the inefficiencies caused by the presence of an externality in a market. Illustrate and explain using diagram...
Explain why the price elasticity of demand is generally a negative number, except in the cases where the demand curve is perfectly elastic or perfectly inelastic. The demand for a good tends to be less elastic when ___. What occurs to price and quantity when supply de...
How can you tell if the economy is in equilibrium? Explain the difference between the simple money multiplier and the money multiplier (provide an example by assuming c is .10 and r is .1). Discuss the scenario where the economy starts to enter a recession and people hold mor...
As planetary boundaries loom, there is an urgent need to develop sustainable equilibriums between societies and the resources they consume, thereby avoiding regime shifts to undesired states. Transient system trajectories to a stable state may differ substantially, posing significant challenges to distingui...
Monopolistic competition occurs where the products that are being sold by competing companies serve different purposes, allowing for entering and exiting the market with ease. Explore the characteristics of monopolistic competition and the factors of equilibrium and risk. ...
to price. The profit maximizing output level of a monopolist occurs where marginal revenue equals marginal cost. Marginal revenue is always less than price under imperfectly competitive markets because to sell an extra unit of output the firm must lower the price of all units, not just the ...
CPI is a variable that is used to access the purchasing power of a country's currency and the level of inflation. Inflation refers to the gradual rise in the prices of commodities and services sold in a country. CPI, therefore, indicates the ...
A monopoly is a type of market structure in which there is a single seller in the market. The seller sells a unique type of product that has no close substitutes. The monopolist has the power to decide the price and output in the market....
The expected inflation rate is 5 percent and the actual inflation rate is 7 percent. According to Friedman, is the economy in long-run equilibrium? Explain. Inflation: Inflation is defined as an economic situation characterized ...
Why is inflation rising in a country where real GDP is higher than nominal ones? QUESTION 1 What does it mean for the inflation gap to be negative? A- An inflation gap is negative when the current inflation rate is less than th...