Economics: Private and Public Choice
16th Edition
ISBN: 9781337642224
Author: James D. Gwartney; Richard L. Stroup; Russell S. Sobel
Publisher: Cengage Learning US
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Chapter ST4, Problem 2CQ
To determine
Effect of savings to an economy.
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Is savings harmful or beneficial to the economy? Contrast the two views on this issue.
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Could you say that the consumers are a significant aspect of an economy? If so, why?
Chapter ST4 Solutions
Economics: Private and Public Choice
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- Why might an investor prefer to invest indirectly rather than directly?arrow_forwardNot counting Social Security, should the government force people to save money in personal accounts for their eventual retirement?arrow_forwardHow distortions affect the market of tradable and non-tradable goods and how it affects the financial and economic values of these goods?arrow_forward
- Lowering the taxes on income can help in expanding the activities in the financial market. True or False?arrow_forwardSuppose people can consume the income they earn or save and invest it at rate ?. If we tax wealth at a rate greater than ?, how are people likely to adjust their rate of savings?arrow_forwardhow does distortion affects the financial and economic values of the tradable and non-tradable goodsarrow_forward
- True or false and why? the paradox of thrift implies that any change in autonomous savings will be neutralised in equilibrium, leaving equilibrium savings and consumption unchanged.arrow_forwardIt analyzes the responsibility of the financial system in the demand for investment versus the supply of savings.arrow_forwardSuppose that Lady Gaga goes to Las Vegas to play poker and at the last minute her record company says it will reimburse her for 60 percent of any gambling losses that she incurs. a. Will Lady Gaga probably wager more or less as a result of the reimbursement offer? (Click to select) b. What economic concept does your answer illustrate? (Click to select)arrow_forward
- Imagine you are an economics professor in a world without money. Explain why it would be tricky to obtain groceries, clothing, and a place to live.arrow_forwardIn the financial market, what causes a movement along the demand curve? What causes a shift in the demand curve?arrow_forwardWhy might we not consider livestock as money, even if it could be used to trade for goods and services in agrarian economies?arrow_forward
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