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Inga [223]
3 years ago
7

Which is the most accurate statement about trade? a. Trade can make every person better off. b. Trade helps rich people and hurt

s poor people. c. Trading for a good can make a person better off only if the person cannot produce that good itself. d. Trade makes some people better off and others worse off.
Business
1 answer:
laiz [17]3 years ago
7 0

Answer:

a. Trade can make every person better off.

Explanation:

Trade generates a benefit for all parties trading. If a party do not fell like winning with trade, it will stop trading and the trade will not occur. It is important for each party to make sure the other wants to keep trading, so quantity and price will be based upon both parties agreement.

A person can trade for product she produces, for example a person who produce a certain fruit can buy the same fruit when is off-station in their side of the world with another producer.

It could also trade becasue is the raw material of a finished product and it need more input for his facilities.

If a person or a party who is trading thinks is worse than before the trade, then it will stop trading so, as long as there is trade, both parties are better off after the trade.

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Suppose that demand for a product is Q = 1200 − 4P and supply is Q = −240 + 2P. Furthermore, suppose that the marginal external
eimsori [14]

Answer: 16 units more than social optimum.

DWL = dead weight loss = (1/2)*(Q* - Q°) 12 =96

Explanation:

Q=1200 - 4P and Q=-240 + 2P

In a free market quantity demand =quantity supplied

1200 -4P = -240 +2P

P =240

Sub P

Q* = 240

Socially optimal quantity is

Marginal social benefit (MSC)= marginal social cost(MSC), including external damage =MEC

MPC= marginal private cost =inverse of supply function

MPC = (1/2)*Q + 120

MEC=12

MSC =(MPC +MEC) = (1/2)Q +120 +12

MSC= MPB where MPB is marginal private benefit = inverse of demand functn

MPB = 300 -(1/4)Q

(1/2)Q + 132 =300 - (1/4)Q

Q° = 224

Difference btw Q* & Q° = 16 units more than social optimum.

DWL = dead weight loss = (1/2)*(Q* - Q°) 12 =96

4 0
3 years ago
Suppose that the marginal propensity to consume in Frugalia is 0.60. The government of Frugalia enacts a stimulus program that i
fgiga [73]

Answer:

option (c) $25 million

Explanation:

Data provided in the question:

The marginal propensity to consume in Frugalia, MPC = 0.60

Increase in spending = $10 million

Now,

The total increase in income

= \frac{\textup{1}}{\textup{1-MPC}}  × Increase in spending

on substituting the respective values, we get

= \frac{\textup{1}}{\textup{1-0.6}}  × $10 million

=  \frac{\textup{1}}{\textup{0.4}}  × $10 million

or

= 2.5 × $10 million

or

= $25 million

Hence,

The answer is option (c) $25 million

5 0
3 years ago
Economists refer to their methodology for analyzing oligopolies as a game theory​ because, as in​ games _____.
melisa1 [442]

Answer:

e. all of the above

Explanation:

Just like inn games, all the features enumerated in the options apply.

Specifically, actions by players determine outcomes. Also, players employ strategies to obtain desired results.

7 0
3 years ago
'As fewer people buy gym memberships, the demand for running shoes will decrease and the price of a pair of running shoes will i
olchik [2.2K]

Answer: "The rise in the price of a pair of running shoes will increase the supply of running shoes".

This statement is <u><em> false</em></u> because <em><u>a decrease in demand for running shoes does not increase the price of a pair of running shoes and an increase in the price of a pair of running shoes does not increase the supply of running shoes. </u></em>

This occurs as the price of a pair of running shoes increases,therefore decreasing the demand and thus the supply will not increase.

4 0
3 years ago
A product sells for $275 per unit, and its variable costs are 68% of sales. The fixed costs are $345,600. What is the break-even
exis [7]
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