Explain why the supply-and-demand model should not be used to analyze the market for jeans
What will be an ideal response?
Products in the jeans market are not identical (at least not in the consumers' eyes). The fact that there is only one manufacturer per brand gives that particular firm (limited) power over the price of its product. Thus, two conditions for the use of the model are not fulfilled.
You might also like to view...
In a small country, using prices of 2012, GDP in 2012 was $100 and GDP in 2013 was $110. Using prices of 2013, GDP in 2012 was $200 and GDP in 2013 was $210
The country's BEA will calculate ________ percent as the growth in real GDP between those years. A) 7.5 B) 15 C) 10 D) 5 E) None of the above answers is correct.
Given the input-output relationships in the table below:
Countries A B Goods X 8 4 Y 4 1 (a) Which country has absolute advantage in which good and why? (b) Which country has comparative advantage in which good and why? (c) If A is endowed with 8000 hours of labor, how much X will it produce after trade begins? How much Y? Explain. (d) What is the allowable range on A's wages relative to B's if trade is flowing between these two countries according to comparative advantage?