Test Yourself 2. What would happen is the equilibrium would be constantly shifting because the lines would constantly be meeting is different spots. 3 a. b. c. d. e. f. g. h. i. j. Would not add to GDP because it does not include goods m
Homework #3 Test Yourself 1. Country A increased its growth by 21% Country B increased its growth by 40% Country C increased its growth by 33% Country D increased its growth by 20% The biggest increase was country B which increased by 40% but only 10
Homework #9 Test yourself 1. After the first person puts it in the bank the bank holds on to 10% but gives out 90% So the bank holds on to 1.2 million while they loan out 10.8 million. The next person puts it in the bank and the bank keeps 1.08 milli
1. One half of 120 billion is 60 billion so that is the number that will be used
60000000000 is put into a bank, and the bank has to hold on to 10% of it.
They keep 6 billion in reserves and they lend out 54 billion, if the next
Externalities; Uncompensated impact of one persons actions on the well-being of a bystander
Negative; Impact on the bystander is adverse (exhaust, barking dogs, second hand smoke)
-Societys optimal quantity is less than the market equilibrium
1. Opportunity cost; The cost of a tradeoff. If you go to lunch, the opportunity cost is the time even
though its free, riding a theme park ride has a cost of the line time.
2. Rational people think at the margin.
3. People respond to incentives (reward/p