Cyclone devastates Australia’s banana crop- Practice IA Introduction to theory: Demand and supply are basic economic theories that can help the government and producers make informed decisions like how much to produce‚ and the price they set for products. Connection to article: The recent Cyclone Larry has affected crops in Australia‚ decreasing their supply of bananas drastically‚ as well as causing a decrease in the employment of workers in the banana industry. Analysis: Demand is the curve that
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6.1a) A monopoly is facing the demand and marginal cost curves which is P = 12 - 0.002Q and MC = 3 + 0.001Q. When the demand curve is P = a- bQ‚ the marginal revenue curve will be MR = a- 2bQ ‚ therefore‚ MR = 12 - 0.004Q.(Refer to figure1) Figure 1 To maximize the profits‚ the company should produce at the output level where marginal revenue is equal to marginal cost. If the marginal revenue is higher than marginal cost‚ the firm can increase profit by producing more. If
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1. What do economists mean when they state that a good is scarce? a. There is a shortage or insufficient supply of the good at the existing price. b. It is impossible to expand the availability of the good beyond the current amount. c. People will want to buy more of the good regardless of the price of the good. d. The amount of the good that people would like exceeds the supply freely available from nature. 2. Which of the following is most clearly consistent with the basic guidepost
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1. The following table shows the average retail price of salted grade AA butter per pound and the Consumer Price Index from 1980 to 2000‚ scaled so that the CPI = 100 in 1980. | 1980 | 1985 | 1990 | 1995 | 2000 | Consumer Price Index | 100.00 | 130.58 | 158.56 | 184.95 | 208.98 | Retail Price of Butter | $1.88 | $2.12 | $1.99 | $1.61 | $2.52 | a. Calculate the real price of butter in 1980 dollars. Recall: Real Price of butter in Year t=CPI1980CPIt×Nominal Price in Year t For Example:
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As an employee of the World Bank‚ you have been asked to research 1 economic concern in a South American country and write a report on your findings. Select a South American country to research. Select one of the following economic concerns to research: Quantities of specific goods and services Gross Domestic Product (GDP) Unemployment Inflation Research data sets for the 1 economic concern within the South American country that you have chosen. In a 3–4 page report‚ answer the
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6. To fully explain the multiplier effect‚ we need first to define the Injections and Withdrawals‚ preferably through the model of Circular flow of income: It is a simple economic model describing a circulation of income between producers (firms) and consumers (households.). It consists of direct inner flow between firms and households and outer flow. The outer flow is caused by the fact that households do not spend all of their income on consumption; part of their income is withdrawn as net
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Explain why government regulation is needed‚ citing the major reasons for government involvement in a market economy. In the beginning there was no intention for the government to have a hand in business. The government wanted businesses to act on their own best interests without any involvement from the government. Regulation was brought about to enhance the public and take care of those that have lost or investigate those who have cheated. For many years there was no government regulation and
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1. The Bureau of Labor Statistics announced that in April 2010‚ of all adult Americans‚ 139‚455‚000 were employed‚ 15‚260‚000 were unemployed‚ and 82‚614‚000 were not in the labor force. Use this information to calculate: a. the adult population = employed+unemployed+not in the labor force=237329000 b. the labor force = employed+unemployed=154715000 c. the labor-force participation rate = (labor force/adult population) x 100= 65.2% d. the unemployment rate = (unemployed/labor force) x 100=
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2011 H1 Economics Prelim Questions Raffles Institution With the help of a diagram‚ analyze the effects of China’s increasing control over rare earths mines on the Japanese economy. To what extent would China’s reduction in the export of rare earths pose a challenge to the West’s march toward a greener future? Evaluate the effectiveness of the Chinese’s government’s intervention in the market for rare earths To what extent do you agree with the view that the US trade position with China over
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Based on the information provided for the market for video games‚ answer the following questions. PRICE Q DEMANDED Q SUPPLIED $50 5 9 $45 7 7 $40 9 5 $35 11 3 $30 13 1 a.) Draw and properly label the demand and supply graphs (this means you must label the axes and any lines you include on the graph). b.) What is the equilibrium price and quantity? a.) b.) PRICE: $45 QUANTITY: 7 Now‚ assume that a new government report claims that video game
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