Economics

Dinah-Lee Torres Nightly Problems Chapter 7 & 8 1) True or absurd: explain why the following statements argon straight or false: a. The stinting maxim there is no property on the table means that there are neer any fallow economic opportunities. False. There are unexploited economic opportunities in the short describe because the draw play of ordained economic bring in. b. Firms in competitive environments make no  accountancy gather when the market is in long run equilibrium. False. Firms in competitive environments make positive accounting profit in the long run and no economic profit in the long run c. Firms that stinkpot introduce greet saving innovations can make an economic profit in the short run. True. In the short run, market terms of goods start not been set yet so firms experience a decrease in take terms due to cost saving innovations, and as a result it creates higher economic profit. 2) Why do damage ceilings crop economic exorbit ance?

Price ceilings reduce economic surplus by atrophy manufacturer surplus and preventing any additional surplus for the consumers. It reduces producer surplus because the producer cant sell at equilibrium price which causes the value of production to be obligate down. This creates less production of the regulated item. For consumer surplus, the very low price of the product provide drive demand up save with the decrease in supply for the product, the consumer will be futile to consume much of that good. Price ceilings therefore create deadened weight dismission because of all the product that isnt bein g utilized.If you want to press a full essa! y, order it on our website: OrderCustomPaper.com

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