Use Okun’s law to determine the size of the GDP gap in percentage-point terms. If the potential GDP is $500 billion in that year, how much output is being forgone because of cyclical unemployment?
Study Question 2 key Questionraph the accompanying demand data, and then use the midpoint formula for Ed to determine price elasticity of demand for each of the four possible $1 price changes. What can you conclude about the relationship between the slope of a curve and its elasticity? Explain in a non-technical way why demand is elastic in the northwest segment of the demand curve and inelastic in the southeast segment.
The reason why demand is elastic in the northwest segment of the demand curve and inelastic in the southeast segment, is that it matters more to the consumer when the ticket is too expensive than it does when it is too cheap.
Study question 7: Key Question A firm has fixed costs of $60 and variable costs as indicated in the table on the following page. Complete the table and check your calculations by referring to question 4 at the end of Chapter 23
b. Graph AFC, AVC, ATC, and MC. Explain the derivation and shape of each of these four curves and their relationships to one another. Specifically, explain in non-technical terms why the MC curve intersects both the AVC and the ATC curves at their minimum points.
c. Explain how the location of each curve graphed in question 7b would be altered if (1) total fixed cost had been $100 rather than $60 and (2) total variable cost had been $10 less at each level of output.
Question 5: The following table gives information from a sample of college students: gender; number of children in family of origin; and number of children in their ideal family, in which they may someday be a parent.
a. Sketch a scatterplot of the data collected from the students and discuss any trends. (Use the same scale on both axes.) Which