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Question about Monopolistic Competition
1. "Monopolistic competition is monopolistic up to the point at which consumers become willing to buy close-substitute products and competitive beyond that point." Explain
2. "Competition in quality and service may be just as effective as price competition in giving buyers more for their money." Do you agree? Why? Explain why monopolistically competitive firms frequently prefer non-price competition to price competition.
3. Why might price collusion occur in oligopolistic industries? Assess the economic desirability of collusive pricing. What are the main obstacles to collusion? Speculate as to why price leadership is legal in the United States, whereas price fixing is not.
Illustrate what factors will increase or decrease the level of international capital mobility between one nation and the rest of the world.
Find the velocity given that the market is in equilibrium. MD1 is the relevant curve and it is given that the real GDP is 30,000.
Economists also businesses almost always compare costs and benefits in their decision making.
Suppose that in the market for comic book illustrators the substitution effect dominates the income effect While visiting Comic Con.
Discuss the difference among inflationary gap also deflationary gap.
If an investor implemented a reverse cash also carry trade, what would the arbitrage profit be.
If your payroll (budget) is increased to $120,000, what should you do to maximize the number of customers served?
Estimate the relationship among inflation,unemployment and business cycle on the industry.
Illustrate what is the present rate of unemployment and the current rate of inflation
Illustrate what did classical economists assume about the flexibility. What disagreements did Keynes have with classical economists.
Explain how does the timing of lay-off and hiring decisions made by firms explain the misleading characteristic of this indicator.
Illustratr what is the Keynesian solution to a recession or depression. Explain how does the Keynesian multiplier work.
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