What condition is necessary for a price floor to have an impact on a market? Describe two effects that a price floor can have on a market
In order for a price floor to be effective, it must be set above the current equilibrium price for that good. Some of the effects that might arise as a result are: surpluses and fewer exchanges.
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What will happen to unemployed retail workers if the government is unable to target stimulus spending at the retail sector?
A. Most will become discouraged and leave the labor force. B. They may eventually find work after government spending works its way through the economy. C. They may eventually find work after the Fed reduces tax rates, increasing household consumption spending. D. They will remain permanently unemployed unless they find work in another sector of the economy.
Refer to the payoff matrix below. If each cell has a probability of occurrence of 0.25, what are Healthy Snacks' expected profits?
Healthy Snacks and Best Treats are two firms competing in the health food snacks market. Both are considering introducing a new health food snack made purely of dried power fruits. The payoff matrix shows their net economic profit in millions for the different strategies.
A) $6.5 B) $11 C) $3.5 D) $9.25