DemandComposition Inflation

Demand Composition Inflation TIle last of the structural theories of inflation is what is known as ‘demand-composition theory’ recently propounded by Professor Charles L. Schultze.  According to Schultze, neither cost-push nor demandpulltheories can offer...

THE WINNERS AND LOSERS FROM TRADE

THE WINNERS AND LOSERS FROM TRADE To analyze the welfare effects of free trade, the Isolandian economists begin with the assumption that Isoland is a small economy compared to the rest of the world so that its actions have little effect on world markets. The...

PROBLEMS AND APPLICATIONS

PROBLEMS AND APPLICATIONS 1. The market for pizza is characterized by a downward-sloping demand curve and an upward-sloping supply curve a Draw the competitive market equilibrium. Label the price, quantity, consumer surplus, and producer surplus. Is there any...

QUESTIONS FOR REVIEW

QUESTIONS FOR REVIEW 1. What happens to consumer and producer surplus when the sale of a good is taxed? How does the change in consumer and producer surplus compare to the tax revenue? Explain. 2. Draw a supply-and-demand diagram with a tax on the sale of the good....