Econ102February11 - Econ 102 I Quantity Quotas a Government...

Info icon This preview shows pages 1–2. Sign up to view the full content.

Econ 102 February 11, 2008 I. Quantity Quotas a. Government established maximum number of units sold i. Qq must be below Q* to be binding ii. Government thinks too many units are being traded iii. Example: Import restrictions from foreign countries b. Usually end up with higher prices and more units i. Supply curve becomes perfectly inelastic right at Qq ii. People are willing to pay any price to get it as long as they want it c. Affects the price of something without a quota because since supply for foreign object becomes perfectly inelastic, it seems like foreign object is more expensive- since foreign object looks more expensive, U.S. object looks less expensive and therefore supply for it goes up- in consequence, the price increases for U.S. object as well II. Roots of Macroeconomics a. The Great Depression- was a period of severe economic contraction and high unemployment that began in 1929 and continued throughout the 1930’s b. Classical economics applied microeconomics models, or “market
Image of page 1

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern