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Economic Loss

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Q2. The high employment deficit is estimated at $100 billion. Assuming that the ecomony is operating below full employment and that it will not overheat during the year,
a. the actual budget is not in deficit.
b. increasing GDP will eliminate the deficit.
c. increasing GDP will not eliminate the deficit.
e. the actual budget is in surplus.

Q8. The current price of compact discs, which are traded in perfectly competitive markets, is $10. A $1 per unit tax is levied on the discs. Annual record sales decline from five million to four million as a result of the tax. Assuming that the income effect of the tax induced price change is negligible, the excess burden of the tax will be,
a. $500,000 per year
b. $1 million per year
c. $2 million per year
$2.5 million per year

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Solution Preview

Hello Student,

As it relates to the question 2, the most suitable answer I believe is B. As it relates to question 8, you may note that, "in economics, the excess ...

Solution Summary

This solution makes reference to two multiple choice questions related to economic loss.

$2.19
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Outsourcing: Cultural and Economic Impacts

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Over the past 20 years, outsourcing has had a tremendous impact on the U.S. economy because formerly "secure" jobs have moved overseas. Outsourcing strategies also call into question the value of education and hard work in achieving success because jobs requiring education and skill are being shifted overseas where workers with the same qualifications cost less to employers.

Tasks :
Is manufacturing work?and union wages?an essential part of the U.S. culture? Is the loss of jobs for white-collar workers in high growth industries the real upsetting factor about outsourcing?

3 sentences for each is needed.

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