Principles of Economics (12th Edition)
12th Edition
ISBN: 9780134078779
Author: Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher: PEARSON
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Chapter 17, Problem 2.2P
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A farmer’s fields are right next to the train tracks, where sparks from the trains set the field on fire. The railroad profit from running zero, one, two or three trains is shown below. The columns indicate the number of trains running. Total railroad profits are the total profits to the railroad from running the specified number of trains. Total lost farmer profits are total profits the farmer loses from a specified number of trains running.
Trains
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- You stay up an added hour to study for a test. The intended effect is to raise your test grade. What might be an unintended effect of staying up an added hour to study for the test?arrow_forwardConflict is a natural and expected part of professional life. Our course examined a number of conflict management strategies. Identify three of these strategies, and explain them in detail. For each strategy, you should also supply an applied example, summarizing a hypothetical situation and showing how conflict is handled under each strategy.arrow_forwardEmployers can try solving the adverse selection problem and motivate the employees to work harder by paying them a high wage.a) trueb) falsearrow_forward
- One method of solving this problem is through signaling. Signaling is a strategy one uses when they have information. The goal is to use a signal to convince the buyer that the good or service that is being sold is quality and will meet the buyer's wants. Offer an example of a company that uses a signal to help sell its product. What is the signal? What information is the signal trying to convey? Do you think the signal is effective? Why or why not? Does this signal improve market efficiency? Why or why not?arrow_forwardThe following table shows payoffs to workers of each type (first number). High or Low; and to the firm(second number).arrow_forwardParticipate in a discussion regarding private information as shown in Section 12.3 in the textbook. Signaling occurs when an informed person takes actions that send information to uninformed persons. The grades and degrees that a university awards to students are signals. They inform potential (uninformed) employers about the abilities of the candidates they are considering hiring. What actions (signals) do you plan to take with your existing or potential employers after receiving your college degree?arrow_forward
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