Block, SkipCaptcha, Automoderated users, Bots, edit
57,719
edits
Changes
Jump to navigation
Jump to search
Line 1:
Line 1: − ===Introductory===+ Line 11:
Line 11: − ===Intermediate===+ Line 44:
Line 44: − ===Honors===+ Line 59:
Line 59: − +
Economics Model Answers Twelve (view source)
Revision as of 04:25, July 12, 2016
, 04:25, July 12, 2016clean up & uniformity
==Introductory==
'''1. Receiving $100 next year is not the same as receiving $100 today because of the _________________.'''
'''1. Receiving $100 next year is not the same as receiving $100 today because of the _________________.'''
Impatience explains interest rates as the emotional desire to have something "right now" causes them to pay more than they would if they were patient and simply waited until they saved the money themselves.
Impatience explains interest rates as the emotional desire to have something "right now" causes them to pay more than they would if they were patient and simply waited until they saved the money themselves.
==Intermediate==
'''3. I agree to pay you $1,000 in one year, if you pay me ______ today. The interest rate is 5%. Fill in the blank, showing your work.'''
'''3. I agree to pay you $1,000 in one year, if you pay me ______ today. The interest rate is 5%. Fill in the blank, showing your work.'''
Due to the [[Law of Demand]], the increased price will reduce demand for the kerosene. But the demand for kerosene will be inelastic. Thus the most significant effect of the price increase will be to increase the profit and economic rent of the kerosene supplier. Because the price increase represents an increase in economic rent due to the crisis, price controls probably would not decrease supply in the short run, and might be desirable. In the long run, however, price controls could lead to shortages. (thanks to Chris J.)
Due to the [[Law of Demand]], the increased price will reduce demand for the kerosene. But the demand for kerosene will be inelastic. Thus the most significant effect of the price increase will be to increase the profit and economic rent of the kerosene supplier. Because the price increase represents an increase in economic rent due to the crisis, price controls probably would not decrease supply in the short run, and might be desirable. In the long run, however, price controls could lead to shortages. (thanks to Chris J.)
==Honors==
'''8. Explain what “economic rent” is in your own words, using your own example.'''
'''8. Explain what “economic rent” is in your own words, using your own example.'''
[[Category:Economics lectures]]
[[Category:Economics lectures]]
{{DEFAULTSORT: Economics Model Answers 12}}
{{DEFAULTSORT:Economics Model Answers 12}}