CASE STUDY

CASE STUDY THEWIZRRD OF OZ AND THE FREE-SILVER DEBATE As a child, you probably saw the movie The Wizard of Oz. based on a children’s book written in 1900. The movie and book tell the story of a young girl, Dorothy, who finds herself lost in a strange land far...

CONFUSION AND INCONVENIENCE

CONFUSION AND INCONVENIENCE Imagine that we took a poll and asked people the following question.This year the yard is 36 inches. How long do you think it should be next year? Assuming we could get people to take us seriously, they would tell us that the yard should...

INFLATION INDUCED TAX DISTORTIONS

INFLATION INDUCED TAX DISTORTIONS Almost all taxes distort incentives, cause people to alter their behavior, and lead to a less efficient allocation of the economy’s resources. Many taxes, however, become even more problematic in the presence of inflation. The...

MENU COSTS

MENU COSTS Most firms do not change the prices of their products every day. Instead, firms often announce prices and leave them unchanged for weeks, months, or even years. One survey found that the typical u.s. firm changes its prices about once a year. Firms change...