Economics Homework Thirteen Answers - Student Nine

Economics homework 13

Mark Brown

2. Free Trade

Right.

3. It is supposed to protect the banking system from collapse.

Correct.

4. Inelastic

Correct again.

6. The high short run prices are to encourage people to purchase tickets early. If consumers wait till a few days before the flight they could force the airline to add another airplane to their schedule to carry the load. This increases their variable costs.

Good explanation from the perspective of the seller (airlines).

7. The firms sell slightly differentiated goods because if the goods were all the same, then they would be very price elastic. If one producer increased his price then many consumers would buy substitutes.

Good analysis.

Perfect ending to terrific homework throughout the course. 50/50. Congratulations.--Andy Schlafly 23:26, 19 December 2009 (EST)