E202PracticeExam1.6

E202PracticeExam1.6 - 4. Why in college do you have...

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4. Why in college do you have different professors teaching you different subjects, but in elementary school the same teacher taught you everything (or almost everything) all year? Answer : There is little source for comparative advantage at the elementary school level. Differences in opportunity costs and resulting gains from specialization increase as the level of knowledge becomes more advanced. Chapter 3 5. How would a fall in the price of fertilizer affect the market supply for corn? Does the supply curve shift left or right and why? What will happen to the equilibrium price and quantity? Answer : Fertilizer is an input. Lower input prices shift the supply curve to the right (supply increases). Equilibrium price falls and equilibrium quantity rises. 6. How would an increase in the wage paid to orange pickers affect the market supply for oranges? Does the supply curve shift left or right and why? What will happen to the equilibrium price and quantity of oranges? Answer
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This note was uploaded on 02/20/2012 for the course ECON 202 taught by Professor Brightwell during the Spring '08 term at Texas A&M.

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