Exam (elaborations)
1B03 - Microeconomics questions and answers
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1B03 - Microeconomics questions and answers
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1-123 of 123- Useful way for consumers to ensure that the goods they are buying are of high
quality
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Brand names
- Workers moving from region to region
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Immigration
- Unemployment increase
- Encourages teens to drop out of school
- Prevents unskilled workers form getting on-the-job training
- Isn't high enough to relieve poverty of working poor
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Critics argues that minimum wage causes...
Cost advantages that enterprises obtain due to size, output, or scale of operation,
with cost per unit of output generally decreasing with increasing scale as fixed costs
are spread out over more units of output.
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Economies of Scale
- Surplus of labour
- Downwards pressure on wages
- Firms can hire more workers
- Diminishing MP
- Lower value of MP
- Gives new equilibrium
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, Increase in supply of labour
- Their income and prices of the goods (can only buy what you can afford)
- BC shows various combinations of goods the consumer can afford, given his/her
income and prices of two goods
*Note: If they want more of one good, they must give up some of the other good
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Budget Constraint
- Advances = Increase in MP_L = Increase D_L
* Note: Only shifts labour demand
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Technological change (not those that replace labour)
A particular "game" between 2 captured prisons that illustrates why cooperation is
difficult to maintain even when it is mutually beneficial
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Prisoner's Dilemma
, In the short run
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A monopolistically competitive firm will resemble a monopoly....
Perfectly elastic (P = AR = MR = D)
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Competitive firm's demand curve
P = min ATC (LR equilibrium)
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Firm will not enter nor exit an industry
Consumers like new products, therefore entry of new firm = positive externality on
consumers
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Product-variety externalities
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