Economics For Today
10th Edition
ISBN: 9781337670654
Author: Tucker
Publisher: Cengage
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Chapter 14, Problem 5SQP
To determine
The inefficiencies in the instructor’s approach.
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Students have asked these similar questions
the answers shown for the part c are incorrect
Switzerland has over 500 watch
manufacturers. Most of them are quite small
and they cluster around the so-called "Watch
Valley" which is an area covering the Jura
Mountains from Geneva to Basel. Swiss
watches dominate the world's fine watch
market.
a) Explain how geographic clustering of the
Swiss watch industry helps to create external
economies of scale.
b) It is quite possible that some other country
has a lower average cost curve for watch
production (e.g. due to lower wages). Yet
Switzerland continues to be the world's
largest producer and exporter of fine watches.
Explain why external EOS have a tendency to
cause established pattern of production and
trade to be "locked in."
The figure to the right shows the market for one-bedroom apartments in Calgary. If this
market is initially unregulated, thousand units will rent for a price of $ per month.
Suppose however, the city imposes the controlled price shown in the figure. In this case,
in the short run, the market experiences an excess
of thousand units.
In the long run, if the controlled price remains in place, the market will show a
of thousand units.
This analysis indicates that as time passes, rent controls will cause housing shortages to
Rental Price ($ per month)
905
610
Rental Housing Market
Sshort run
Slong run
Controlled Price
24
50 60
Quantity of Rental Units (Thousands)
Chapter 14 Solutions
Economics For Today
Ch. 14.2 - Prob. 1.1GECh. 14.2 - Prob. 1.2GECh. 14.2 - Prob. 1.3GECh. 14.2 - Prob. 2.1GECh. 14.2 - Prob. 2.2GECh. 14.2 - Prob. 2.3GECh. 14.2 - Prob. 2.4GECh. 14 - Prob. 1SQPCh. 14 - Prob. 2SQPCh. 14 - Prob. 3SQP
Ch. 14 - Prob. 4SQPCh. 14 - Prob. 5SQPCh. 14 - Prob. 6SQPCh. 14 - Prob. 7SQPCh. 14 - Prob. 8SQPCh. 14 - Prob. 9SQPCh. 14 - Prob. 10SQPCh. 14 - Prob. 11SQPCh. 14 - Prob. 12SQPCh. 14 - Prob. 13SQPCh. 14 - Prob. 14SQPCh. 14 - Prob. 15SQPCh. 14 - Prob. 16SQPCh. 14 - Prob. 1SQCh. 14 - Prob. 2SQCh. 14 - From an economic viewpoint, the optimal amount of...Ch. 14 - Prob. 4SQCh. 14 - Prob. 5SQCh. 14 - Prob. 6SQCh. 14 - Prob. 7SQCh. 14 - Prob. 8SQCh. 14 - Prob. 9SQCh. 14 - Prob. 10SQCh. 14 - Prob. 11SQCh. 14 - Prob. 12SQCh. 14 - Prob. 13SQCh. 14 - Prob. 14SQCh. 14 - Prob. 15SQCh. 14 - Prob. 16SQCh. 14 - Prob. 17SQCh. 14 - Prob. 18SQCh. 14 - Prob. 19SQCh. 14 - Prob. 20SQ
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