the ways in which the rent seeking can result in fall in the production of goods and services and the role played by the underground economy in reducing the fall in productive activities.
Concept Introduction:
Rent seeking is a type of resource or capital earning system by a company, organization or individual to obtain economic gain without reciprocating any benefits to society and creating wealth. This involves an earning income through profit, wage and rent. Rent is considered the least risky and easiest type of earning income because it requires resource ownership and the ability to use these resources to generate income by lending their use to others. It can be problematic when the company increases the no. of shares without increasing the total capital.
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Chapter 16 Solutions
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- 2arrow_forward(Money Demand) Suppose that you never carry cash. Your pay- check of $1,000 per month is deposited directly into your checking account, and you spend your money at a constant rate so that at the end of each month your checking account balance is zero. What is your average money balance during the pay period? How would each of the following changes affect your average monthly balance?arrow_forward4. The table below is extracted from Goodland Republic Bureau of Statistics records for 2016-2017. Use the information to answer the questions that follow. Goodland Economy 2013 and 2018 I tem Price 2017 (Base year) Price 2018 Price per Price per Production Unit ($) Production Unit (S) 50,000 1.50 55,000 2.00 100.000 2.00 98000 250 50,000 23,000.00 45,000 2,450.00 120.000 100.00 110,000 120.00 5.000 5,000.00 6,000 7,000.00 Rice (tons) Wheat (tons) Tractors mid-size (units) Cotton (tons) Used cars Manufacture garments (tons) Eggs (Trays) Coca Cola (litres) Pepsi Cola (litres) Beef (tons) Second hand cloths (tons) Alcoholic Beverages (litres) Milk (litres) 150,000 2.000 6,000 700 5,000 500 500 7000 50.00 2.50 0.80 1.10 6.50 15.00 3.25 230 145,000 2,300 6.500 850 4.800 450 600 7.500 70.00 3.50 1.20 1.50 8.50 25.00 3.75 2.50 Examine the status of the economic welfare in Goodland Republic in 2018 based on your GDP deflator, nominal GDP and Real GDP. Also, explain the reasons why it is…arrow_forward
- (Market Supply of Labor) The following table shows the hours per week supplied to a particular market by three individuals at various wage rates. Calculate the total hours per week (Q1) supplied to the market. Why does the quantity supplied tend to increase with the hourly wage? Which individuals, if any, have backwards-bending supply curves in the wage range shown? Does the market supply curve bend backward in the wage range shown in the table?arrow_forward- U.S. aggregate demand and long-run aggregate supply decreased during the Great Recession. This caused real gross domestic product (GDP) to and the price level to decrease; decrease increase; increase decrease; remain unchanged decrease; increase remain unchanged; increasearrow_forwardjust subpart d) need graph (figure) drawn computerisedarrow_forward
- 1A. (Liu) An American university has enough places for 9000 students. Government restrictions mean that at least 75% of the places must be given to US students but the remainder may be given to non-US citizens. There are 5000 residential places available on campus. All overseas students and at least one-quarter of the US students must be given places on campus. The university get $12000 in tuition fees for each US student and $15000 for each overseas student. It wants to maximize the fees received. Using the letter x for the number of places given to US students and y for the number of places for overseas students, (1) write down an expression for the objective function and state whether it is to be maximized or minimized; (2) write down the constraints that define the feasible region and explain your reasoning carefully; (3) identify which aspect of the original problem has been overlooked in parts (a) and (b); (4) graph the feasible region.arrow_forward14arrow_forward5. Which of the following statements is TRUE? (A) When supply rises, the price goes up. (B) The GDP deflator can measure inflation. (C) When demand falls, quantity rises. (D) The Bank of Canada controls all interest rates.arrow_forward
- Please helparrow_forward40.) What was one negative consequence of the development of factories? a. People migrated to cities for factory jobs b. the first textile factory was built in England c. Diseases spread quickly through cramped factory neighborhoodsarrow_forward(Money Demand) Suppose that you never carry cash. Your pay- check of $1,000 per month is deposited directly into your checking account, and you spend your money at a constant rate so that at the end of each month your checking account balance is zero. You are paid $500 twice monthly rather than $1,000 each month. You are uncertain about your total spending each month. iii. You spend a lot at the beginning of the month (e.g., for rent) and little at the end of the month. iv. Your monthly income increases.arrow_forward