What is the market fundamentals price and how might it differ from the equilibrium price?
What will be an ideal response?
The market fundamentals price is the price determined by the fundamental determinant of demand, the value of marginal product, and the fundamental determinant of supply, the marginal cost of extraction. When people's expectations of the price differ from the market fundamentals price, then the demand and supply are affected by the expected price. At this point the equilibrium price, determined in part by people's expectations, differs from the market fundamentals price.
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Evaluate the statement: “There is no difference between the labor supply curve for the single competitive firm and the supply curve in a competitive market for labor.”
What will be an ideal response?
Over the past 50 years, the growth of real GDP in the United States has been caused primarily by increase in the _____.
Fill in the blank(s) with the appropriate word(s).