ECN 340 Lecture Notes - Demand Curve

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turquoisewildebeest476

3 Oct 2012

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In a loving relationship, one person is concerned about the welfare of the other. Each person in the relationship is both donor of gifts and a recipient. Each person realizes there is an unwritten social contract between the two: try to make the other person happy. Donor of a gift receives pleasure from giving to the recipient the less expensive gift the more often he/she will give recall the downward sloping demand curve. Gifts can be in the form of money, a box of candy, simply listening to the other person, or providing a sexual experience. Gifts are given until mc = mb. But there is a possibility of exploitation! The recipient can subtly say, give me this amount or i will take nothing (deny you the pleasure of seeing me happy)! If the recipient asks for too much , the donor may be better off giving nothing.

Related Questions

In 2009, it was estimated that the total value of all corn-production subsidies in the United States totaled about $4 billion. The population of the United States was approximately 300 million people that year.

a. On average, how much did corn subsidies cost per person in the United States in 2009? (Hint: A billion is a 1 followed by nine zeros. A million is a 1 followed by six zeros.) Instructions: Round your answer to 2 decimal places. $ per person.

b. If each person in the United States is only willing to spend $0.40 to support efforts to overturn the corn subsidy, and if antisubsidy advocates can only raise funds from 20 percent of the population, how much money will they be able to raise for their lobbying efforts? Instructions: Round your answer to 1 decimal place. $ million.

c. If the recipients of corn subsidies donate just one percent of the total amount that they receive in subsidies, how much could they raise to support lobbying efforts to continue the corn subsidy? Instructions: Enter your answer as a whole number. $ million.

d. By how many dollars does the amount raised by the recipients of the corn subsidy exceed the amount raised by the opponents of the corn subsidy? Instructions: Round your answer to 1 decimal place. $ million.

olivemole983

QUESTION 5

Economic theory predicts that the introduction of child support enforcement programs will:

	A.	reduce the cost of providing welfare benefits to the states that provide such programs.
	B.	increase the labor supply of some welfare recipients who were not working prior to the introduction of this program.
	C.	have no effect on the labor supply of some welfare recipients.
	D.	All of the above are correct.

2 points

QUESTION 6

In the hedonic pricing model of job risk, a flatter isoprofit curve indicates that:

	A.	the cost of reducing risk is relatively high.
	B.	the cost of reducing risk is relatively low.
	C.	most individuals are not risk-averse.
	D.	None of the above is correct.

amaranthwater-buffalo893

A newspaper article once reported that the U.S. economy was experiencing a low rate of inflation. It said that "low inflation has a downside: 45 million recipients of Social Security and other benefits will see their checks go up by just 2.8 percent next year."

a. Why does inflation affect the increase in Social Security and other benefits?

b. Is this effect a cost of inflation, as the article suggests? Why or why not?

crimsonbeaver701

ECN 340 Lecture Notes - Demand Curve

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