skip to Main Content

aggeregate demand

what is aggeregate demand according to closed economy? Aggregate demand curve shows the relationship between the total quantities of output and price level demanded and price level in an economy. In a closed economy, it is basically a sum of…

Read More

haberler s opportunity cost theory

explain the criticisms of haberler's theory of opportunity cost of international trade?? Let us define the concept of opportunity cost first. In the context of production, the opportunity cost of producing a commodity (say X), is the quantity of another…

Read More

Domestic Prices

How are domestic prices determined in the absence of trade between two countries? In autarky, i.e. under no trade situation, the domestic prices are determined by equating the price ratio with the slope of the PPF, i.e. MRTS. Suppose an…

Read More

Price Elasticity of Demand

About four years ago, Kanye West performed at the UIC Pavilion. General admission tickets were priced at $30. Concert promoters say that price elasticity of demand for general admission concert tickets was-1.5. Although this show was sold out, concert promoters…

Read More

Productivity of rocking chairs

Phoenix furniture uses 10 workers, each working 8 hours, to produce 80 rocking chairs. What is Phoenix's productivity Total units of production = 80Working hours of each employee = 8 hrs, number of employees = 10. Therefore total working hours…

Read More

gdp

why is gdp an imperfect measure of economic well being? GDP is often considered as a measure of economic well-being. An increase in the economy’s GDP is regarded as an improvement in the economic well-being. But there are several limitations…

Read More

microeconomics questions

Question 1(2 points) Refer to the above figure. Profits for this firm are negative Question 1 options: A) only for all points less than B. B) only at points B and C. C) for points between B and C. D)…

Read More