Explain if the transaction can improve the welfare of people.

Question

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Answer 1

Question

Chapter 2, Problem 1CQ

To determine

Explain if the transaction can improve the welfare of people.

Expert Solution & Answer

Explanation of Solution

In an economy, ‘J’ will get $5,000 by trading used car to ‘S’. In this case, by getting $5,000, ‘J’ can spend their entire $5,000 in the market and this leads to improve the welfare of more people in an economy.

Thus, the given statement is ‘False’.

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The accompanying graph shows the short-run demand and cost situation for a price searcher in a market with low barriers to entry. Price (dollars) 24 8 MC ATC MR 30 D 45 50 Quantity/time The firm will maximize its profit at a quantity of units. After choosing the profit maximizing quantity, the firm will charge a price of The firm will receive $ in revenue at the profit-maximizing quantity. The total cost of production for this profit-maximizing quantity is S The maximum profit the firm can earn in this situation is $ per unit for this output. How will the situation change over time? Profits will attract rival firms into the market until the profit-maximizing price falls to the level of per-unit cost. ◇ Losses will induce firms to leave this market until the profit maximizing price falls to zero. The market will adjust until the price charged by this firm no longer exceeds marginal cost at the profit-maximizing quantity. This market is already in long-run equilibrium, and will not…

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Answer 2

Question

Chapter 2, Problem 1CQ

To determine

Explain if the transaction can improve the welfare of people.

Expert Solution & Answer

Explanation of Solution

In an economy, ‘J’ will get $5,000 by trading used car to ‘S’. In this case, by getting $5,000, ‘J’ can spend their entire $5,000 in the market and this leads to improve the welfare of more people in an economy.

Thus, the given statement is ‘False’.

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Answer 3

Question

Chapter 2, Problem 1CQ

To determine

Explain if the transaction can improve the welfare of people.

Expert Solution & Answer

Explanation of Solution

In an economy, ‘J’ will get $5,000 by trading used car to ‘S’. In this case, by getting $5,000, ‘J’ can spend their entire $5,000 in the market and this leads to improve the welfare of more people in an economy.

Thus, the given statement is ‘False’.

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Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Question

Chapter 2, Problem 1CQ

To determine

Explain if the transaction can improve the welfare of people.

Expert Solution & Answer

Explanation of Solution

In an economy, ‘J’ will get $5,000 by trading used car to ‘S’. In this case, by getting $5,000, ‘J’ can spend their entire $5,000 in the market and this leads to improve the welfare of more people in an economy.

Thus, the given statement is ‘False’.

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Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 2, Problem 1CQ

To determine

Explain if the transaction can improve the welfare of people.

Expert Solution & Answer

Explanation of Solution

In an economy, ‘J’ will get $5,000 by trading used car to ‘S’. In this case, by getting $5,000, ‘J’ can spend their entire $5,000 in the market and this leads to improve the welfare of more people in an economy.

Thus, the given statement is ‘False’.

Answer 6

Chapter 2, Problem 1CQ

To determine

Explain if the transaction can improve the welfare of people.

Expert Solution & Answer

Explanation of Solution

In an economy, ‘J’ will get $5,000 by trading used car to ‘S’. In this case, by getting $5,000, ‘J’ can spend their entire $5,000 in the market and this leads to improve the welfare of more people in an economy.

Thus, the given statement is ‘False’.

Answer 7

Chapter 2, Problem 1CQ

To determine

Explain if the transaction can improve the welfare of people.

Answer 8

Expert Solution & Answer

Explanation of Solution

In an economy, ‘J’ will get $5,000 by trading used car to ‘S’. In this case, by getting $5,000, ‘J’ can spend their entire $5,000 in the market and this leads to improve the welfare of more people in an economy.

Thus, the given statement is ‘False’.