Urgent Essay Help-Micro Economics
After a major earthquake struck Los Angeles in 1994, several stores raised the price of milk to over $6 per gallon. The local authorities announced that they would investigate and that they would enforce a law prohibiting price increases of more than 10% during emergency period. What is the likely effect of such a law?
Is it possible that an outright ban on foreign imports will have no effect on the equilibrium price?
Arthur spends his income on bread and chocolate. He views chocolate as good but is neutral about bread, in that he does not care if he consumes it or not. Draw his indifference curve map.
Sofia will consume hot dogs only with fries. Draw her indifference curve map.
Prescott (2004) argues that US employees work 50% more than German, French, and Italian employees because they face lower marginal tax rates. Assuming that workers in all four countries have the same tastes toward leisure time and goods, must it necessarily be true that US employees will work longer hours? Explain why.
Does Prescott’s evidence indicate anything about the relative sizes of the substitution and income effects? Why or why not?
