1) Leading economic indicators
1) Leading economic indicators suggest that incomes will begoing up next year. In response to these reports, companies areforecasting increased prices for future sales of their goods. As aresult of these increases, the supply curve will
| shift to the right, causing the equilibrium price toincrease. |
| remain the same, but the equilibrium price will increase. |
| shift to the left, causing the equilibrium price toincrease. |
| remain the same, but the equilibrium price will decrease. |
| shift to the right, causing the equilibrium price todecrease. |
2) A possible opportunity cost of NOT engaging in free tradeis
A)a smaller variety of goods and services. B)economic growth. C)a loss of domestic jobs. D)higher prices. E)import tariff
3) During a job search, individuals will sometimes accept thelower of two competing salary offers. What would best explain thisdecision?
| The lower salary is still better than the salary earned at theprevious job. |
| A person may accept a lower starting salary in order to receivegreater future pay increases. |
| The total benefits of the higher paying job are greater thanthe total benefits of the lower paying job. |
| The total benefits of the lower paying job are greater than thetotal benefits of the higher paying job |
|
Individuals never accept a salary that exceeds their personalvalues. |
Answer:
Answer 1 : As result of increase in income the supply curveshift to the left causing the Equilibrium price to increase. Asincome increase supply curve shift to the left because price hasbeen increased and lower quantity has been supplied at new price.Now new Equilibrium set at higher price and lower quantity.
Answer 2. A possible opportunity cost of not engaging in freetrade is economic growth . As restrictions on free trade resultedin higher price of the good. Competition has been decreased whereas free trade has increased economic of growth and country economicgrowth.
Answer 3. During a job search, individual will sometimes acceptthe lower of two compensating salary offers because individualnever accept the salary which exceed there personal values. Themain reason for choosing low salary job is personal values areconflicting with high salary job . Salary is utmost important butworking against personal value cannot estimated.Long term goals ofthe company also affect the decision. Sometimes satisfaction levelof lower Salary is more than higher values.
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