Exploring Macroeconomics
7th Edition
ISBN: 9781285859446
Author: Sexton, Robert L.
Publisher: Cengage Learning
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Question
Chapter 4, Problem 19P
To determine
(a)
Effect on the supply of coffee worldwide if the freezing temperature wipes out half of the Brazil's coffee crop
To determine
(b)
Effect on supply of coffee around worldwide if the wages of coffee workers in Latin America rise as unionization efforts succeed.
To determine
(c)
Effect on supply of coffer around the world if Indonesia offers big subsides to its coffee producers.
To determine
(d)
Effect on supply of coffee around the world if a genetic engineering produces a coffee bean that grows faster and needs less care
To determine
(e)
Effect on supply of coffee around the world if coffee suppliers expect the prices to be hiher in the future.
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Which of the following graphs best represents the production possibility frontier of Country Y (Line Y), the production possibility frontier of Country Z (Line Z), and the production possibility frontier of this whole economy (Line W)? (Hint: Find W by adding the productive capabilities of Country Y and Z)
Group of answer choices
Which of the following factors tend to decrease the wage differential between union and non union workers:
unions tend to organize the firms with the lowest ability to pay initially
all of the above
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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…
Chapter 4 Solutions
Exploring Macroeconomics
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