Can the same principles that have been used in the study of advanced economies be used to study less developed economies as well? Explain your answer
What will be an ideal response?
Yes. All economic analysis deals with the problem of making choices under conditions of scarcity, and the problem of satisfying people's wants and needs is as real for Somalia and Haiti as it is for the United States, Germany, and Japan. The universality of scarcity is what makes economic analysis relevant to all nations, regardless of their level of material well-being or ruling political ideology.
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"The price elasticity of demand is a measure of how sensitive demanders are to changes in the price of a product." Is this statement true or false?
What will be an ideal response?
The balance sheet channel describes ways in which interest rate changes resulting from monetary policy affect
A) the portfolio decisions of households. B) the portfolio decisions of businesses. C) borrowers' net worth. D) lenders' net worth.