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Why is it true that shortages usually occur mainly when price controls are in effect?In the nonexistence of price controls the shortage generally goes away quickly because prices are bid up to remove the excess demand. But with price controls in effect the shortage generally persists. This helps describe why we generally only see long lines in effect while the government imposes a price ceiling like it did throughout the 1970s so-called gas crisis.
Explain the figure of say''s law of market
TAKE A HYPOTHETICAL ECOMOMY AND CONSTRUCT THE CONSUMPTION SCHUDEL CONTAIN 10 PAIR OF HYPOTHETICAL VALUE OF AGGERGET INCOME AND CONSUMPTOIN
Suppose the demand curve for a consumer for coffee is: Q = 6 - 2P, where Q represents the number of cups per day and P is the price of coffee per cup. 1. Suppose the con
Natural Factors: Seasonal variations may affect the demand for a commodity at certain times of the year. For example, during the raining season, demand for commodities such as j
Andrew has preference given by: u(x,y) = min{2x, 3y} The price for good x and good y are identical and equal to 4. At his optimal consumption bundle he achieves a utility of 90. W
What are the possible advantages of free trade? Firms a) Specialisation and enhanced use of comparative advantage b) Possibility of advantages of scale c) Spread
Explain how a country can peg (fix) its currency to another currency. Explanation of a pegged/fixed currency should centre on how the central bank uses the currency market mech
A Period of Deterioration: The entire period was very difficult for India's BOP, partly because of slow growth of exports in relation to import requirements and partly because
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