hinders efficient outcomes in a market economy because it involves one party in an economic action having less information than the other‚ therefore it might agree to buy a certain product or service and pay for more than what it gets (or vice versa if seen from the ignorant seller’s perspective). The avoidance of negative perverse incentives leads governments into better policy making and achieving the desired economic effect and increase in efficiency. If the principal-agent problem is addressed correctly
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CAMBRIDGE INTERNATIONAL EXAMINATIONS International General Certificate of Secondary Education ECONOMICS Paper 1 Multiple Choice May/June 2003 1 hour Additional Materials: Multiple Choice Answer Sheet Soft clean eraser Soft pencil (type B or HB is recommended) 0455/01 READ THESE INSTRUCTIONS FIRST Write in soft pencil. Do not use staples‚ paper clips‚ highlighters‚ glue or correction fluid. Write your name‚ Centre number and candidate number on the answer sheet in the spaces provided unless
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Economic Critique University of Phoenix ECO371 January 21‚ 2013 Economic Critique Currently‚ our country is in a recession‚ and the unemployment rate is at an all-time high. The unemployment rate consists of people not only out of work but also those who can work and are actively looking for work (Colander‚ 2010). Unemployment also means there are more people out of work than there are jobs available (Colander
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Chapter: 5 Question: Categorize each seller below on the basis of the type of market it operates in. Explain each of your answers: a. A Cattle farmer b. A Computer market c. A picture framing shop is a large metropolitan area. d. A seller of Canadian dollars in a foreign currency markets. e. A life insurance company f. A liquor store in a remote village g. A visual Artist h. A Country that produces a valuable radioactive mineral found in no other part of the world. Answer to the question
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following topics as relating to microeconomics or macroeconomics. a) A family’s decision about how much income to save. b) The effect of government regulations on auto emissions. c) The impact of higher national saving on economic growth. d) A firm’s decision about how many workers to hire. e) The relationship between the inflation rate and changes in the quantity of money. 3. Draw a circular-flow diagram. Identify the components of the model that correspond
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Macro Economic System and its Management. 1. Macro Economic Concerns: • Micro vs Macro Economics. • Major Building Blocks of Macro Economics: 1) AD & AS 2) Four Sectors: HHS‚ BS‚ GS & FTS 3) Two Markets: Commodity Market and Money Market. • Specific issues to be addressed in Macro Economics: o Rising Prices o Rising Unemployment o Falling GDP o Balance of Payments Crisis. • Tools of Macro Economic Policy and Management:
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Chapter 1 1. Describe some of the trade-offs faced by each of the following: 1. a family deciding whether to buy a new car 2. a member of Congress deciding how much to spend on national parks 3. a company president deciding whether to open a new factory 4. a professor deciding how much to prepare for class 5. a recent college graduate deciding whether to go to graduate school 2. You are trying to decide whether to take a vacation. Most of the costs of the
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negative. Question Relative to a competitively organized industry‚ a monopoly produces Answer more output‚ charges higher prices and‚ earns economic profits. less output‚ charges lower prices and‚ earns economic profits. less output‚ charges lower prices and‚ earns only a normal profit. less output‚ charges higher prices and‚ earns economic profits. Question Which of the following is NOT an example of price discrimination? Answer Airlines charging lower prices to travelers who stay
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Economics 304 Winter 2013 Assignment 1 : Due date‚ Thursday February 7 in Class 1. Consider the following OLG model with money. Assume that the population of the economy grows at rate n such that Nt = nNt−1 for every period and n > 1 and money is also growing in this economy at the rate γ that is Mt = γMt−1 ‚ where γ > 1. The endowment that each young generation is born with is assumed to be fixed at y. The initial old each receives an equal portion of the money supply Mt . Suppose that the
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2012 Labour Economics: Essay topics 1. “A number of factors impacted negatively on the South African labour market between 1900 -1922.” Give a concise outline of those factors. Briefly describe some the conflicts that resulted. 2. Write an essay discussing the motivation and methods for creating the colour bar in the South African labour market during the first half of the 20th century. 3. “The Labour Relations Act of 1995 makes it possible for Employers and Trade Unions to operate
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