Siteadmin, Bureaucrats, Check users, nsAm_Govt_101RO, nsAm_Govt_101RW, nsAm_Govt_101_ta, nsJudgesRO, nsJudgesRW, nsJudges_talkRO, nsJudges_talkRW, nsTeam2RO, nsTeam2RW, nsTeam2_talkRO, nsTeam2_talkRW, oversight, Administrators
125,794
edits
Changes
Jump to navigation
Jump to search
Line 22:
Line 22: + +
Economics Homework Four - Model (view source)
Revision as of 19:27, October 11, 2009
, 19:27, October 11, 2009added one
:The income effect is the wealth that you gain or lose when the price of an item changes. For example, if hamburger is on sale for $.99 per pound vs $1.99 a pound, the effect is that I am gaining $1 and will purchase more hamburger as a result. (Shanna)
:The income effect is the wealth that you gain or lose when the price of an item changes. For example, if hamburger is on sale for $.99 per pound vs $1.99 a pound, the effect is that I am gaining $1 and will purchase more hamburger as a result. (Shanna)
:The “substitution effect” starts off when the price a good increases. Since people do not want to pay the higher price, the substitute of the item starts to sell more due to its lower price. As a result the demand for the good with the higher price decrease as the demand for the lower priced substitute increases. (Leonard)
7. Charity is based on the foundation of a successful free market. Or is a successful free market based on a foundation of charity? Describe and explain which is the cart, and which is the horse (in other words, which comes first or is most important, charity or the free market).
7. Charity is based on the foundation of a successful free market. Or is a successful free market based on a foundation of charity? Describe and explain which is the cart, and which is the horse (in other words, which comes first or is most important, charity or the free market).