Author Question: How is economics used as a policy tool? What will be an ideal ... (Read 107 times)

naturalchemist · **on:** Jun 29, 2018

How is economics used as a policy tool?

What will be an ideal response?

Question 2

A Big Mac costs 4.79 in the United States and 9.6 zlotys in Poland. If the exchange rate is 3 zlotys per dollar, purchasing power parity predicts that

A) the dollar will appreciate as the demand for dollars rises in the long run.
B) the dollar will depreciate as the demand for dollars falls in the long run.
C) the dollar will appreciate as the supply of dollars falls in the long run.
D) the dollar will depreciate as the supply of dollars rises in the long run.

kingfahad97 · **Reply #1 on:** Jun 29, 2018

Answer to Question 1

Individuals, businesses, and governments use economics as a policy tool. Individuals use the economic ideas of marginal benefit and marginal cost when making decisions for such topics as attending college, paying cash or credit for a purchase, and working. Businesses also use the concepts of marginal benefit and marginal cost when making decisions about what to produce, how to produce, and even how many hours to stay open. Finally governments also use marginal benefit and marginal cost when deciding issues such as the level of property taxes, the amount to fund higher education, or the level of a tariff on Brazilian ethanol.

Answer to Question 2

D