India is rapidly growing country, with surgical labor productivity, but vast rur
ID: 1248288 • Letter: I
Question
India is rapidly growing country, with surgical labor productivity, but vast rural areas remain among the poorest on the planet and may still have larger populations than the more affluent urban areas. People from the countryside, especially from minority tribes, move to the vibrant cities, earn what they felt they need and return to the countryside, returning more quickly the more they earn per hour. Describe the behavior of labor markets that employ such people. If you can describe (do not draw) a graph of what happens.
multiple question:
2. Consumer surplus
(a) represents the amount a consumer would be willing to pay over and above what (s)he has to pay for a good or service
(b) is another name for monopoly profit
(c) is the amount a producer collects from the consumer over and above what the consumer really wants to pay
(d) necessarily equals zero in equilibrium except in the case of perfect competition
3. What is a distinguishing characteristic of a public good?
(a) It is sold to the general public
(b) It is sold or provided by a public entity such as a government. Food stamps are an example.
(c) One, two or many individuals can consume the good simultaneously at no additional cost to the supplier
(d) The person buying the good provides benefits--or causes harm--to the general public for which (s)he does not receive or provide compensation.
4. Regarding innovation and invention:
(a) May be subject to boomerang effect if innovation occurs abroad after domestic invention
(b) Innovation is less likely in small firms than invention
(c) Oligopolies sometimes engage in an "arms race" of innovation
(d) All of the above are true
(e) All of the above are false
5. Which of the following would probably NOT be on an economist's recommended list of ways to deal with a pollution problem?
(a) Set strict limits on pollutants for each offending factory
(b) Sell pollution permits to factories
(c) Fine polluting factories according to the pollution damage they cause
(d) None of the above would be on the list of recommended ways
Explanation / Answer
1)The more money a worker makes, the less valuable each excessive unit of currency becomes. Because of this, the worker will value leisure more and return to the country faster. 2)a 3)c 4)d 5)a Limits would not only be placed on offending factories.