Microeconomics Private And Public Choice 16th Edition James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson - Solutions

Discover the ultimate resource for mastering "Microeconomics: Private and Public Choice, 16th Edition" by engaging with our comprehensive solutions. Access online answers key and solutions PDF, packed with solved problems and step-by-step answers. This textbook's chapter solutions and test bank are perfect for students seeking clarity, offering an instructor manual to guide their studies. With our solution manual, deepen your understanding of complex concepts through expertly crafted questions and answers. Enjoy the convenience of a free download and transform your learning experience with these invaluable resources.

1.3 For each of the following situations, identify the full cost(opportunity cost) involved:a. Monique quits her $50,000 per-year job as an accountant to become a full-time volunteer at a women’s shelter.b. The Agrizone Corporation invests $12 million in a new inventory tracking system.c. Taylor
1.2 Every month, Frank pays an $80 membership fee at a fitness center so he can avail himself of the unlimited use of its facilities. On average, he goes to the center 10 times a month. What is the average cost of each trip he makes to the center? What is the marginal cost of an additional work-out
1.1 One of the scarce resources that constrain our behavior is time. Each of us has only 24 hours in a day. How do you go about allocating your time in a given day among competing alternatives? How do you go about weighing the alternatives? Once you choose a most important use of time, why do you
1. Would the academic outcomes of university juniors change as they become university seniors if they?
11. Does concern about the environment change our views of free trade?
10. What are the benefits and costs of free trade?
9. How did Aristotle think about just prices? How do we explain price wars in the airline industry?
8. Is high frequency trading socially beneficial? Do co-pays by patients change the choice and use of medicines by insured patients?
7. What effect would a tax on carbon have on emissions? Is a tax better or worse than rules?
6. How did the growth of railroads and improvement in transportation more generally change the U.S.banking systems in the nineteenth century?
5. Does increasing employment opportunities for girls in developing nations increase their educational achievement?
4. What inferences can we make based on conditional moment inequalities?
3. How does the resource allocation process differ in market versus command and control systems?
2. Do aggregate household savings increase when we automatically enroll people in savings programs and let them opt out as opposed to requiring them to sign up?
1. What do you think accounts for where components of the iPod and Barbie are made?
*“Unlike a marketplace in which pollution is protable, government control of resources and pollution can take into account the desires of all the people.” Evaluate, using economic thinking.
“The buildup of carbon dioxide and other gases in the air threatens to warm the planet and cause enormous damage worldwide. We must immediately stop this buildup for the sake of future generations.” Indicate why you agree or disagree with this statement.
“The national parks belong to us all. No one should be charged money to enter.” Evaluate, using the economic way of thinking.
*The movie The Perfect Storm was set in a situation in which a very short shing season forces the shers to go to sea despite the dangerous conditions. Explain how a move to ITQs could solve that problem.
Why have cotton elds retreated and forests returned in many areas of the southeastern United States? With fewer acres farmed, will the nation continue to be able to provide food and ber for itself? Explain.
*Even though the wage scale of union members is substantially greater than the minimum wage, unions have generally been at the forefront of those lobbying for higher minimum rates. Why do you think unions ght so hard for a higher minimum wage?
*A survey of rms in your local labor market reveals that the average hourly wage rate of unionized production workers is$1.50 higher than the average wage rate of nonunion production workers. Does this indicate that unionization increases the wage rates of workers in your area by $1.50? Why or why
Evaluate the following statements.a. “An increase in the price of steel will be passed along to consumers in the form of higher prices for automobiles, homes, appliances, and other products made with steel.”Do you agree or disagree?b. “An increase in the price of craft union labor will be
*“If a union is unable to organize all the major rms in an industry, it is unlikely to exert a major effect on the wages of union members.” Indicate why you either agree or disagree.
*Suppose that Florida’s migrant workers are effectively unionized.What will be the effect of the unionization on (a) the price of Florida oranges? (b) the prots of Florida fruit growers in the short run and in the long run? (c) the mechanization of the fruitpicking industry? (d) the employment
Compared to women, men are overrepresented in occupations like coal mining and construction, in which working conditions are more dangerous. For example, 4,320 American men were killed on the job in 2014, compared to 359 women. How will the more dangerous working conditions of men inuence their
*In 2014, the median earnings of single men working fulltime, year-round were only 60 percent of their married counterparts.Does this indicate that employment discrimination existed against single men and in favor of married men?
Physical strength is important in some jobs. Do you think differences in physical strength between men and women contribute to earnings differences according to gender? Why or why not? Do they also inuence the share of men relative to women who will pursue a college education? Explain.
*Between 1960 and 1990, the labor force participation rate of married women approximately doubled. What impact did this inux of married workers into the labor force have on (a) the average years of work experience of women relative to men,(b) the mean hours of work time of women relative to men,
*The government now requires insurers to provide insurance to persons with preexisting adverse health conditions. How does this inuence the incentive to purchase insurance when you are healthy?
Suppose the government established a new program that would use revenues from a payroll tax to nance 85 percent of the maintenance and repair cost of automobiles incurred by those who are employed. How would this legislation inuence (a) the prices of auto repair and maintenance services, (b)
*Do personal choices inuence health care expenditures? If health care is paid for by others or if everyone is charged the same premium for health care, how will this inuence the incentive to make healthy lifestyle choices?
Consider the ve reform proposals suggested by the authors in this special topic. Indicate why you believe each is either a good or a bad idea. Explain your answers.
*How did the Medicare and Medicaid programs inuence the cost of medical services purchased by Americans who were neither poor nor elderly? Explain.
*When an employer provides health insurance benets as part of the compensation package, does this represent a gift by employers to their employees? Do employees earn these benets?Why or why not? Justify your response.
How does the substitution of third-party payments by insurance companies and the government for the out-of-pocket purchase of health care by consumers inuence the demand and price of medical services? Explain.
Could the United States ever experience another Great Depression?Why or why not?
Do the length and severity of the Great Depression reect a defect in the operation of markets? Do they reect a failure of government policy? Discuss.
Some charge that the crisis of 2008 was caused by the “greed”of Wall Street rms and other bankers. Do you agree with this view? Do you think there was more greed on Wall Street in the rst ve years of this century than during the 1980s and 1990s? Why or why not?
*When mortgage originators sell mortgages to Fannie Mae, Freddie Mac, and investment banks the originators have no additional liability for possible default by the borrower. How will this arrangement inuence the incentive of the originators to scrutinize the creditworthiness of the borrower? Would
When did mortgage default and housing foreclosure rates begin to rise rapidly? When did the economy go into recession?Was there a causal relationship between the two? Discuss.
*If owners have little or no equity in their houses, how will this inuence the likelihood that they will default on their mortgage? Why?
What happened to the credit standards (e.g., minimum down payment, mortgage loan relative to the value of the house, and creditworthiness of the borrower) between 1995 and 2005? Why did the credit standards change? How did this inuence the housing price bubble and later the default and foreclosure
Can government intervention generally be counted on to act more like a benevolent social planner, xing problems with the best interest of citizens as the goal, or will government tend to cater toward special-interest groups at the expense of the general public? Discuss the potential problems with
Without government intervention, would the economy uctuate more or less over the business cycle? Contrast the two views on this issue. Be sure to address both the inherent stability of the market economy as well as the impact of government interventions to steer the economy.
Is savings harmful or benecial to the economy? Contrast the two views on this issue.
*According to Keynes, when the economy is in a recession, increased government spending can bring the economy back to full employment. This spending could be on conducting a war with the military or on nancing public works projects.Hayekians would alternatively argue that building and dropping
Are stocks a risky investment? How can one reduce the risk accompanying stock market investments?
What is the random walk theory of stock prices? What does it indicate about the ability of “experts” to forecast accurately the future direction of stock prices?
What is an indexed equity mutual fund? What is a managed equity mutual fund? How will the administrative costs of the two differ?
*The stocks of some corporations that have never made a profit, especially those in high-technology industries, have risen in price. What causes investors to be willing to buy these stocks?
If an investment adviser gives you some hot new stock tip, is it likely to be a “sure thing”? Why or why not? If you have a stockbroker and purchase the stocks promoted by the broker, are you likely to earn a high return on your stock investments?Why or why not?
*Google stock rose from $208 at year-end 2005 to $770 per share at year-end 2015. Google has made sizable prots but never paid a dividend. Why were people willing to pay such a high price knowing that they might not get dividends for many years?
Suppose that more expansionary monetary policy leads to in-ation and higher nominal interest rates. How is this likely to affect the value of stocks? Explain.
*A friend just inherited $50,000. She informs you of her investment plans and asks for your advice. “I want to put it into the stock market and use it for my retirement in 30 years. What do you think is the best plan that will provide high returns at a relatively low risk?” What answer would
The Social Security payroll tax is split equally between the employee and the employer. Would it make any difference if the entire tax were imposed on employees?Would employees be helped if all the tax were imposed on employers? (Hint: You may want to consult the section on tax incidence in Chapter
Does the current Social Security system promote income equality? Why or why not?
How does Social Security affect the economic well-being of blacks relative to whites and Hispanics? Explain.
Do you think workers should be permitted to invest all or part of their Social Security taxes into a personal retirement account? Why or why not?
*Why does the Social Security system face a crisis? Are there real assets in the Social Security Trust Fund that can be used to pay future benets? Will the trust fund help to avert higher future taxes or benet reductions or both when the babyboomers retire? Why or why not?
Is the Social Security system based on the same principles as private insurance? Why or why not?
Can democracy survive if a majority of the citizenry pay little or nothing in taxes while beneting directly from a higher level of government spending? Why or why not?Discuss.
How have the size and functions of government changed during the last two centuries? Did the framers of the U.S.Constitution seek to limit the size of the federal government?If so, how?
*As the result of changes during the last two decades, the bottom half of income recipients now pay little or no personal income tax. Rather than paying taxes, many of them now receive payments back from the IRS as the result of the Earned Income Tax Credit and Child Tax Credit programs.Do you
Compared with the situation before 1981, the marginal tax rates imposed on individuals and families with high incomes are now lower. What was the top marginal personal income tax rate in 1980? What is the top rate now? Are you in favor of or opposed to the lower marginal rates? Why?
Because the structure of the personal income tax is progressive, a larger share of income is taxed at higher rates as real income increases. Therefore, economic growth automatically results in higher taxes unless offsetting legislative action is taken. Do you think this is an attractive feature of
During the past ve decades, there has been a shift in the composition of the federal budget toward more spending on income transfers and health care and a smaller share for national defense. Does economics indicate that this change will help Americans achieve higher living standards? Discuss.
*How do taxes inuence the efciency of resource use? How much does it cost for the government to raise an additional dollar (or $1 billion) of tax revenue?
“Physical obstacles like bad roads and stormy weather increase transaction costs and thereby reduce the volume of trade. Tariffs, quotas, exchange rate controls, and other human-made trade restrictions have similar effects.” Evaluate this statement.Is it true? Why or why not?
*“Tariffs not only reduce the volume of imports, they also reduce the volume of exports.” Is this statement true or false?Explain your answer.
As U.S. trade with low-wage countries like Mexico increases, will wages in the United States be pushed down? Why or why not? Are low-wage workers in the United States hurt when there is more trade with Mexico? Discuss.
The United States uses an import quota to maintain the domestic price of sugar well above the world price. Analyze the impact of the quota. Use supply and demand analysis to illustrate your answer. To whom do the gains and losses of this policy accrue? How doesthe quota affect the efciency of
“The United States is suffering from an excess of imports.Cheap foreign products are driving American rms out of business and leaving the U.S. economy in shambles.” Evaluate this view.
*Does international trade cost Americans jobs? Does interstate trade cost your state jobs? What is the major effect of international and interstate trade?
The European Union has virtually eliminated trade restrictions among its members, and most members now use a common currency. What impact have these changes had on European economies?
*It is often alleged that Japanese producers receive subsidies from their government permitting them to sell their products at a low price in the U.S. market. Do you think we should erect trade barriers to keep out cheap Japanese goods if the source of their low price is a government subsidy? Why
How do tariffs and quotas differ? Can you think of any reason why foreign producers might prefer a quota rather than a tariff? Explain your answer.
“Getting more Americans to realize that it pays to make things in the United States is the heart of the competitiveness issue.”(This is a quote from an American business magazine.)a. Would Americans be better off if more of them paid higher prices in order to “buy American” rather than
Suppose that a very high tariff was placed on steel imported into the United States. How would that affect employment in the U.S. auto industry? (Hint: Think about how higher steel prices will impact the cost of producing automobiles.)
*“An increased scarcity of a product benets producers and harms consumers. In effect, tariffs and other trade restrictions increase the domestic scarcity of products by reducing the supply from abroad. Such policies benet domestic producers of the restricted product at the expense of domestic
“Imports destroy jobs; exports create them. The average American is hurt by imports and helped by exports.” Do you agree or disagree with this statement? Explain.
*Can both of the following statements be true? Why or why not?a. “Tariffs and import quotas promote economic inefciency and reduce the real income of a nation. Economic analysis suggests that nations can gain by eliminating trade restrictions.”b. “Economic analysis suggests that there is
Suppose as the result of the Civil War that the United States had been divided into two countries and that, through the years, high trade barriers had grown up between the two. How might the standard of living in the “divided” United States have been affected? Explain.
*“Trade restrictions limiting the sale of cheap foreign goods in the United States are necessary to protect the prosperity of Americans.” Evaluate this statement made by an American political leader.
Why do American households and businesses buy things from foreigners? What are the characteristics of the items we buy from foreigners? What are the characteristics of the things we sell to foreigners?
Suppose one family has annual income of $100,000 whereas another has only $20,000. Is this outcome fair? What is your initial reaction? Compare and contrast your views depending on the following:a. The family with the higher income has two persons working full-time, while the lower-income family
Suppose points are taken away from all students who earn A’s and redistributed to those students who earn F’s. As a result, the A students end up with B’s and the F students end up with D’s. How would this redistribution affect the incentive of students to study and learn?
As income transfer programs accompanying the War on Poverty increased beginning in the latter half of the 1960s, what happened to the poverty rate? Does economics indicate that this was surprising? Why or why not?
“Means-tested transfer payments reduce the current poverty rate. However, they also create an incentive structure that discourages self-sufciency and self-improvement.Thus, they tend to increase the future poverty rate.Welfare programs essentially purchase a lower poverty rate today in exchange
The outcome of a state lottery game is certainly a very unequal distribution of the prize income. Some players are made very rich, whereas others lose their money.Using this example, discuss whether the fairness of the process or the fairness of the outcome is more important, and how they differ.
Large income transfers are targeted toward the elderly, farmers, and the unemployed, regardless of their economic condition. Why do you think this is so? Do you think there would be less income inequality if the government levied higher taxes in order to make larger income transfers? Why or why not?
Some people argue that taxes exert little effect on people’s incentive to earn income. Suppose you were required to pay a tax rate of 50 percent on all money income you earn while in school. Would this affect your employment? How might you minimize the personal effects of this tax?
What groups are overrepresented among those with relatively low incomes? Do the poor in the UnitedStates generally stay poor? Why or why not?
*Sue is a single parent with two children. She is considering a part-time job that pays $1,600 per month. She is currently drawing monthly cash benets of $600, food stamp benets of $200, and Medicaid benets valued at$160. If she accepts the job, she will be liable for employment taxes of $112
*Because income transfers to the poor typically increase the implicit marginal tax rate they confront, does a $1,000 transfer payment necessarily increase the income of poor recipients by $1,000? Why or why not?
Do individuals have a property right to income they acquire from market transactions? Is it a proper function of government to tax some people in order to provide benets to others? Why or why not? Discuss.
*Consider a table such as Exhibit 3 in which the family income of parents is grouped by quintiles down therst column, and that of their offspring is grouped by quintiles across the other columns. If there were no intergenerational mobility in this country, what pattern of numbers would appear in
What is income mobility? If there is substantial income mobility in a society, how does this inuence the importance of income distribution data?
*Is annual money income a good measure of economic status? Is a family with an $80,000 annual income able to purchase twice the quantity of goods and services as a family with $40,000 of annual income? Is the standard of living of the $80,000 family twice as high as that of the $40,000 family?
Do you think the current distribution of income in the United States is too unequal? Why or why not? What criteria do you think should be used to judge the fairness of the distribution of income? Is the nal outcome more important than the process that generates the income?

Showing 5700 - 5800 of 6303

First
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64

Microeconomics Private And Public Choice 16th Edition James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson - Solutions

Step by Step Answers