If the average price level in 2002 was 1.25 relative to the base year in 1992, then:
a. a dollar in 2002 bought just 80 percent of the goods and services that a dollar bought in 1992.
b. average prices were 80 percent higher in 2002 than in 1992.
c. a dollar in 2002 bought 25 percent more goods and services than a dollar bought in 1992.
d. average prices were 125 percent higher in 2000 than in 1992.
e. purchasing power rose 25 percent between 1992 and 2002.
a
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Consider two individuals, Artie and Deena, who produce wind chimes and sun dials. Artie's and Deena's weekly productivity are shown in Table 3.4. Which of the following is TRUE?
A) Artie has a comparative advantage in producing wind chimes but not sun dials. B) Artie has a comparative advantage in producing sun dials but not wind chimes. C) Artie has a comparative advantage in producing both goods. D) Artie does not have a comparative advantage in producing either good.
Explain the problem encountered by successive monopolies? How can the supplier and the producer overcome this problem?