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Pavel [41]
3 years ago
9

The economy experiences an increase in the price level and a decrease in real domestic output. Which of the following is the lik

ely explanation?

Business
1 answer:
Veseljchak [2.6K]3 years ago
7 0

Answer: Input Prices have increased.

Explanation:

When an Economy sees prices rising but at the same time productivity is falling, the likely cause of that is an increase in Input prices.

Input Prices are the prices of the raw materials and other goods needed to produce finished goods. If these prices should rise, it becomes more expensive for producers to produce and they will therefore reduce the amount of goods they produce. This reduction in Quantity leads to an increase win prices because according to the Law of Supply and Demand, if supply reduces and demand remains the same then prices must increase till a new equilibrium is reached.

For example, imagine a hypothetical Economy of Steel Makers. If the price of Iron changed from $5 to $10, producers who were producing 20 units of Steel will see their costs double and react by producing only 10 units of Steel to maintain cost margins thereby dropping Productivity.

The 20 units of Steel used to be sold in the market at $20 but now that the supply has dropped to 10 units, the price doubles to $40 to cater for this reduction in Quantity.

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Apply concepts what would be the variables on a supply schedule alike and different
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it would be a to d, c to b, d to e

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3 years ago
The purpose of having a minimum wage is to _____. a. Educate workers about what they could be making b. Guarantee that workers a
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The purpose of having a minimum wage is to guarantee that workers are paid fairly and not exploited.

Answer:b

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3 years ago
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In the money creation process, the simple money multiplier assumes that banks hold no excess reserves. What is the consequence o
Alinara [238K]

Answer:

If banks hold excess reserves, then the money multiplier will be smaller.

Explanation:

It is easier to understand using an example:

required reserve rate = 5%

money multiplier = 1 / 5% = 20

if $100 are injected in to the economy and they are deposited in the banking system, the money supply will increase by $100 x 20 = $2,000. But this calculation only works if banks lend 100% of the loanable funds, but if instead banks only lend $90, instead of $95 ($100 x 95%), then the money multiplier will be 1 / 10% = 10. In this case, the money supply will only increase by half

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3 years ago
demand and marginal revenue curves are downward-sloping for monopolistically competitive firms because
Brrunno [24]

Demand and marginal revenue curves are downward-sloping for monopolistically competition firms because: a. product differentiation allows each firm some degree of monopoly power.

<h3>What is product differentiation?</h3>

Product differentiation  can be defined as what makes a product to different from another product which is why some producer tend to include a unique features in their so as to make their product distinct from that of others.

A monopolistic competitive firms can tend to  face a downward - sloping demand curve based on the fact that it help to differentiate their product from that of others competitors.

Therefore the correct option is A.

Learn more about Product differentiation here: brainly.com/question/8107956

#SPJ1

The complete question is:

Demand and marginal revenue curves are downward-sloping for monopolistically competition firms because...

a)product differentiation allows each firm some degree of monopoly power

b)there are a few large firms in the industry and they each act as a monopolist

c)mutual interdependence among all firms in the industry leads to collusion

d)each firm has to take the market price as given

6 0
1 year ago
Marilyn, Bob, and Carl all believe a certain defendant is probably guilty and should be sentenced. Individually their recommenda
bazaltina [42]

Answer:

Explanation:

Group polarization is a concept in social psychology where the decision made by a group of people is more extreme to the decision made by the individual members of the group.

The members of the group recommended 3,5,7 years as prison sentence individually but 10 years together. 10 years is more extreme when compared to the sentences recommended individually.

I hope my answer helps you.

5 0
3 years ago
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