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One of the main tenets of economic analysis is that people act in their own narrow interests. Why, then, do people leave tips in restaurants? If a study were to compare the size of the tips earned by servers in roadside restaurants with those frequented mostly by locals, what would you expect to find? Why?
a) Summarize the basic tenets of the arguments in this case. b) Do you agree with main tenets of the arguments in the case? Why? Justify your answer with detailed explanations. s
What are the Four different measures of GDP Using circular flow model we see that there are 4 equivalent techniques of measuring GDP: Using the definition: market value
In 2001, Puerto Rico enacted a law that requires specific labels on cement sold in Puerto Rico and imposes fines for any violations of these requirements. The law prohibits the sal
Employ the weights given below and suppose that 2002 is the base year with a CPI equal to 100. Suppose also that since 2002 the price of food has increased by 10 percent; the price
Question 1: Discuss why living standards are higher in some countries than others. Question 2: (a) How is inflation measured? (b) What are the causes and consequence
Q. Show the example on IS-curve? Figure We can explain this argument with the above figure. 1. Start by identifying R 1 and R 2 in lower graph. 2. Draw aggr
Assume the United States has the following consumption information: GDP = Income Consumption
Q. Relationship between number of hours worked and unemployment? In all models we presume a negative relationship between number of hours worked and unemployment. If number of
state and explain two factors that cause the shifts in the balance of payments curve.
The Budget Line: The Consumer Constraints The consumer would like to maximize his satisfaction by reaching the highest possible indifference curve. But in the process, he faces
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