Chapter 6 Quiz

It won't let me embed... so click the link below! =)


http://www.quizrevolution.com/ch/a139764/go

Compare the GDP, unemployment rate, and inflation for the following countries

GDP:
Canada - 1,336,068 /  7.8% /2.4%
USA - 14,119,000 / 9.0%/ 3.8%
Japan- 5,068,996 / 5.1%/ 1.4%
Germany - 3,330,032  / 6.7%/ 2.7%
France - 2,649,390  / 2.8%/ 10.1%
UK - 2,174,530/ 7.9% / 3.6%
Italy - 2,112,780 / 8.2% / 3.4%

Edited- Explanation for the convex shape of the PPC

The PPC is a grraphical way to represent the trade off between two goods - producing more of one while give up less of another - in an efficient way. The curve is in a downward slope, and curving outwards. The downward slope can be explained by the scarcity of resources. And also, when the resources are specialized, it is likely to be more productive than trying to produce certain quantity of both and therefore create the convex shape of the PPC. When the resouces to make guns are transferred to make butter, the output of butter does not equal to the amount of resource that guns given up (as shown in the diagram below). This is due to the law of increasing opportunity costs.  Each time that we transfer resources from the production of guns to butter, each additional unit of butter will cost more than the previous one.

Questions and Case Study

QUESTIONS #1-7 (excluding elasticity questions)
1. p = price, q= people
    b) 30 people
    c) $100
    d) 16people
        16*$7 = $112 - revenue increase
2. I disagree with these statements. As both curves shift, we can observe the change in both quantity    and prices from the graph and determine the shift in market equilibrium.

4. a) higher prices would generally decrease the demand
    b) as clothing is a normal-good, the demand will increase with the increase of incom because now 
        consumers can afford more
     c) lower prices will also affect the demand curve becasue with the decrease of price, consumers w
         will buy more and also they could afford more of the product

5. a) eq price: $6.55
        eq quantity: 1521.36

CASE STUDY CATEPILLAR
... where is it?


        

ECON QUIZ

As the diagrams wouldn't show up in the quiz, we were only able to complete 5 of them and graded by ourselves by checking the answers at the bottom.

Percentage: 100%