Explanation Option (b) In the United States over the past century, average income measured by real GDP per person has grown by about 2 percent per year and this rate of growth implies that average income doubles every 35 years and hence, because of this growth, most of the Americans enjoy much greater economic prosperity than before. Thus, option ‘b’ is correct. Option (a) The rate of growth of 2 percent in the U.S. economy over the past century implies that average income doubles every 35 years and not in every 14 years...

Real GDP growth in the U.S.

Principles of Economics

7th Edition

ISBN: 9781305156043

Author: N. Gregory Mankiw

Publisher: Cengage Learning US

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Chapter 25, Problem 1QCMC

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Real GDP growth in the U.S.

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Chapter 25, Problem 8QR

Chapter 25, Problem 2QCMC

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Use the following table to work Problems 5 to 9. Minnie's Mineral Springs, a single-price monopoly, faces the market demand schedule: Price Quantity demanded (dollars per bottle) 10 8 (bottles per hour) 0 1 6 2 4 3 2 4 0 5 5. a. Calculate Minnie's total revenue schedule. b. Calculate its marginal revenue schedule. 6. a. Draw a graph of the market demand curve and Minnie's marginal revenue curve. b. Why is Minnie's marginal revenue less than the price? 7. a. At what price is Minnie's total revenue maxi- mized? b. Over what range of prices is the demand for water from Minnie's Mineral Springs elastic? 8. Why will Minnie not produce a quantity at which the market demand for water is inelastic?
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The Firm's Output Decision (Study Plan 12.2) Use the following table to work Problems 4 to 6. Pat's Pizza Kitchen is a price taker. Its costs are Output (pizzas per hour) Total cost (dollars per hour) 0 10 1 21 2 30 3 41 4 54 5 69 4. Calculate Pat's profit-maximizing output and economic profit if the market price is (i) $14 a pizza. (ii) $12 a pizza. (iii) $10 a pizza. 5. What is Pat's shutdown point and what is Pat's economic profit if it shuts down temporarily? 6. Derive Pat's supply curve.
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