Principles of Macroeconomics 2e
2nd Edition
ISBN: 9781947172388
Author: Steven A. Greenlaw; David Shapiro
Publisher: OpenStax
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Textbook Question
Chapter 10, Problem 31RQ
What is the difference between
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The table below shows pizza topping preferences for Marcus, Dakota, and Austin, and that each individual has strictly transitive preferences. Suppose that three individuals
make up our "society." In this society, prefer pepperoni to cheese pizza; _prefer cheese to supreme; and prefer supreme to pepperoni. This example illustrates that
_
Person
Marcus
Dakota
Austin
0000
First Preference
Pepperoni
Supreme
Cheese
Second Preference
Cheese
Pepperoni
Supreme
Third Preference
Supreme
Cheese
Pepperoni
two-thirds; two-thirds; two-thirds; even if individuals' preferences might satisfy the transitive property, societal preferences may not.
two-thirds; two-thirds; everyone; if individuals' preferences satisfy the transitive property, societal preferences must also.
two-thirds; two-thirds; everyone; even if individuals' preferences might satisfy the transitive property, societal preferences may not.
two-thirds; two-thirds; two-thirds; if individuals' preferences satisfy the transitive property,…
Consider the table below, which has data on insurance status and medical expenditures for different types of professors at Hypothetical University (HU), economics &
criminology professors. Assume that there are an equal number of economics and criminology professors. Assume further that econ professors all have the same level of health
and criminology professors all have the same level of health.
In 2020, every professor was offered a full insurance contract with no premium. In 2021, HU charged any employee who wanted to keep health insurance the actuarially fair
premium based on 2020 expenditures. This premium would be equal to and, as a result,professors dropped their coverage in 2021.
_
2020
2021
Insured? Avg. Expenditures Insured? Avg. Expenditures
Economics Professors
Criminology Professors Yes
Yes $25,000
$15,000
000000
$15,000; criminology
$25,000; econ
$20,000; econ
$15,000; econ
$20,000; criminology
$25,000; criminology
???
$28,000
???
$10,000
Consider the table below, which has data on insurance status and medical expenditures for different types of professors at Hypothetical University (HU), economics &
criminology professors. Assume that there are an equal number of economics and criminology professors. Assume further that econ professors all have the same level of health
and criminology professors all have the same level of health.
There is evidence of
2021
Insured? Avg. Expenditures Insured? Avg. Expenditures
2020
Economics Professors
Criminology Professors Yes.
Yes
$25,000
$15,000
0000
???
???
$28,000
$10,000
I. moral hazard because in 2021 criminology professors dropped their coverage and health expenditures went down.
II. adverse selection because in response to rising premiums after 2020, the professors with lower health expenditure dropped coverage
Both I and II
neither I nor II
Chapter 10 Solutions
Principles of Macroeconomics 2e
Ch. 10 - If foreign investors buy more U.S. stocks and...Ch. 10 - If the trade deficit of the United States...Ch. 10 - State whether each of the following events...Ch. 10 - In what way does comparing a countrys exports to...Ch. 10 - At one point Canadas GDP was 1,800 billion and its...Ch. 10 - The GDP for the United States is 18,036 billion...Ch. 10 - Why does the trade balance and the current account...Ch. 10 - State whether each of the following events...Ch. 10 - How does the bottom portion of Figure 23.3,...Ch. 10 - Explain the relationship between a current account...
Ch. 10 - Using the national savings and Investment...Ch. 10 - If a country is running a government budget...Ch. 10 - What determines the size of a countrys trade...Ch. 10 - If domestic Investment increases, and there is no...Ch. 10 - Why does a recession cause a trade deficit to...Ch. 10 - Both the United States and global economies are...Ch. 10 - For each of the following, indicate which type of...Ch. 10 - How did large trade deficits hurt the East Asian...Ch. 10 - Describe a scenario in which a trade surplus...Ch. 10 - The United States exports 14 of GDP while Germany...Ch. 10 - Explain briefly whether each of the following...Ch. 10 - If imports exceed exports, is it a trade deficit...Ch. 10 - What is included in the current account balance?Ch. 10 - In recent decades, has the U.S. trade balance...Ch. 10 - Does a trade surplus mean an overall inflow of...Ch. 10 - What are the two main sides of the national...Ch. 10 - What are the main components of the national...Ch. 10 - When is a trade deficit likely to work out well...Ch. 10 - Does a trade surplus help to guarantee strong...Ch. 10 - What three factors will determine whether a nation...Ch. 10 - What is the difference between trade deficits and...Ch. 10 - Occasionally, a government official will argue...Ch. 10 - A government official announces a new policy. The...Ch. 10 - If a country is a big exporter, is it more exposed...Ch. 10 - If countries reduced trade barriers, would the...Ch. 10 - Is it better for your country to be an...Ch. 10 - Many think that the size of a trade deficit is due...Ch. 10 - If you observed a country with a rapidly growing...Ch. 10 - Occasionally, a government official will argue...Ch. 10 - What is more important, a countrys current account...Ch. 10 - Will nations that are more involved in foreign...Ch. 10 - Some economists warn that the persistent trade...Ch. 10 - In 2001, the United Kingdoms economy exported...Ch. 10 - Imagine that the U.S. economy finds itself in the...Ch. 10 - Table 23.7 provides some hypothetical data on...Ch. 10 - Imagine that the economy of Germany finds itself...
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