Questions tagged [nonexpert]

For questions that are not about formal economic or econometric models and techniques, their implementations using programs and languages or do not include references to, are not about data standards, or are not based on academic sources.

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1answer
27 views

Why does central banks lowering interest rate incentivize more borrowing?

I'm a layman trying to understand how the US monetary system works. I'm particularly interested in how the Federal Reserve can create inflation without printing new dollars and putting them in M1. My ...
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0answers
15 views

What are markets where prices are really subjective called?

Market for lemons comes to mind but that has to do with consumer uncertainty about the quality of a product. What do you call a market where quality is easy to verify, but price isn't, and price is ...
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0answers
21 views

What is meant by digital currency?

I know that China introduced digital currency for the first time in 2014.There was some issue following the bitcoin. But I sincerely do not understand what it means by digital currency. A slightly ...
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0answers
32 views

Doubt in a particular statement taken from a textbook

"Economics studies how individuals firms, governments and other organizations within our society make choices and how these choices determine a society's use of resources." Firstly, what is ...
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0answers
25 views

Are there poor in the world because of the rich people?= [duplicate]

This is my question if there are millions of people suffering poverty :( is this just because the rich people 'sotle' their money ? in the sense of game Theory is ECONOMY a ZERO sum game ? so if one ...
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0answers
14 views

Concept behind under-represented entities becoming over-represented due to their increasing competitiveness and preferential policies? [closed]

Suppose a particular fraction of the society was thrown under the bus (oppressed) earlier and they could not progress equally like their counterparts. Later with the help of welfare policies, the ...
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0answers
11 views

Producer Theory [closed]

Here’s a story economist tells one another: A Nobel Prize–winning economist flew to New York City for a conference. He got into a cab, and started talking with the cab driver. The cab driver said, “Oh,...
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35 views

Which country has the most efficient growth?

By efficient I mean "currency printed by the country's government" vs the GDP growth. The currenty printed should be measured in weight of gold, i.e. if the govt print 1 trillion of its ...
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0answers
17 views

What is the total that the US Government has spent on Economic Stimulus in 2020 and 2021 so far?

How much has the US government spent on the Economic Stimulus during this "time of covid"? Bonus points if it includes (and itemizes) indirect spending like spending on Covid Testing and ...
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0answers
10 views

Relation inExchange rate of currency.and Export

You might say that this question has been asked many times. But all were too complex for me. I read a report stating Indian Rupee appreciation (from 75 to 73), will negatively affect exports for India....
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1answer
36 views

What is causing the difference between USA financial indexes and perceived economy?

While the world is facing economic problems since the spread of Covid-19 in Feb 2020, the main indexes in the world (S&P500 and NASDAQ100) reached and exceeded twice their maximum levels. I ...
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0answers
23 views

A universal basic income and Keynesian economics [closed]

Do Keynesian economics have a positive view on a universal basic income?
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1answer
658 views

Are spectrum auctions a tax?

According to Wikipedia, A spectrum auction is a process whereby a government uses an auction system to sell the rights to transmit signals over specific bands of the electromagnetic spectrum and to ...
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0answers
10 views

Has the loan of securities from a retail investor to a well-established US broker ever resulted in a financial loss to the retail investor?

Retail investors may opt to loan some of the shares to their brokers: In theory, one of the risks is that the broker and the collateral may have some issue, leaving the retail investor with a ...
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0answers
8 views

Is importing included in the value of the final product that is calculated in GDP

I have been arguing with my friends about wheather imports are included in the gdp or not. For example, I have a locally built device that is worth 900\$. Then I imported a chip worth 100\$ and ...
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0answers
39 views

How do big companies invest their corporate treasuries?

At the end of 2020 Google had 137B of "cash", of which 110B are "short-term investments" which includes anything in the investable universe that can be converted to cash within a ...
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1answer
180 views

consumer surplus decreasing

MRU has the following question on a quiz: Suppose the government forced all bread manufacturers to sell their products at a “fair price” that was half the current, free-market price. To keep it ...
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1answer
73 views

If I fill a vending machine with \$0.50 sodas and sell them for \$1, am I creating 50 cents of wealth for the economy?

This is a very simplified example. If I fill a vending machine with sodas that cost \$0.50 each and someone comes along and pays \$1 for it, am I creating an extra \$0.50 of wealth for the economy? ...
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1answer
42 views

Why has China's integration into the global economy caused it to slow it's output?

In the following passage, what does it mean to be integrated into the economy and why does this mean that now China and India are integrated into the economy that their output has slowed down? In the ...
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0answers
20 views

What Interest Rate used to calculate opportunity cost?

What Interest Rate used to calculate opportunity cost (Calculating Future Value/Present Value)? Usually in the textbook it said that the rate used is government bonds interest rate(since it's risk ...
17
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1answer
3k views

Are democracies more economically productive than autocracies?

The book The Dictator's Handbook claims in several places that democracies are more productive than autocracies. It's central to their argument of lower taxation rate in democracies giving more wealth ...
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0answers
21 views

Find indifferent interest rate

2 refrigerator are available to purchase A,B: Initial Price/Interest rate per year A=$400/$100/year Initial Price/Interest rate per year B=$340/$120/year At what interest rate would you be indifferent ...
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0answers
31 views

Order-driven vs quote-driven markets

What is the difference between order driven and quote driven markets? Is there any theoretical microstructure book that gives the intuition behind the types of markets with respect to the orders that ...
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0answers
28 views

What is the right amount of money supply? [closed]

As Bitcoin limits the money supply and the total amount of coins in circulation, whereas central banks have a degree of freedom to influence the money supply, I came to wonder what perspectives and ...
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1answer
77 views

Why do most function images take the form of a curve? [closed]

I always see curves (such as in dark blue below) and not any other type of (function) image. May I get a reason for why it is always like that? This figure is only for representation.
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2answers
93 views

Why would China's housing be in a bubble?

This popular video on YouTube, "China's Reckoning: Housing Crisis", suggests that the housing market in China is in a bubble, because the vacancy rate is very high. However, it also ...
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0answers
25 views

Effects between price level and interest rate

I'm looking at the relationship between the price level and the interest rate in an economy. If the price level goes up, with fixed nominal money supply, the real money supply goes down, therefore, ...
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1answer
92 views

Is “technical chart analysis” for stock development something that is scientifically supported?

I assume the answer is "no" because if you can predict the development of a stock then people would get very rich. However there are so many YouTube channels and web sites where people talk ...
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2answers
44 views

Why do yield spikes reflect badly on tech stocks

Yield spikes are a reflection of market equity valuation. How I interpret this is that there’s real fear that some companies in the market won’t be able to pay their debt. Therefore, bonds trade cheap,...
2
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1answer
39 views

Is M&A valuation a good proxy for company fair value?

I'm building a model for estimating a fair value of a company. Naturally I'd like to see if model's predicative capabilities are any good. Would using a value of a friendly M&A deal be a good ...
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0answers
26 views

Finding simple multiplier using G,Y,P,W

Let us say the estimated equation for the economy’s aggregate demand is Y = 400 – 15P + 8G And the estimated equation for the economy’s aggregate supply is Y = 5 + 11P – 10W where Y is the country’s ...
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0answers
20 views

Does key money for low-rent leases typically correspond to the capitalised difference to the market rent? [closed]

Key money is often paid when taking over a lease with a contract rent below the market rate (Wikipedia). In theory I would expect the key money to correspond to the capitalised difference to the ...
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0answers
32 views

Demand Function in monopoly [duplicate]

I am studying monopoly and I see that most exercises use inverse demand. why use the inverse demand function instead of the demand function?
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5answers
231 views

How is economics even a science, rather than just politics?

"Take from the rich and give to the poor," says the Left-wing politician who stands to benefit from the votes of poor voters they bribe with government benefits. "Take from noone, and ...
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2answers
49 views

How should I regress income inequality on economic growth?

I would like to know which variables to use to regress income inequality on economic growth. For income inequality, I am thinking of using the Gini index, but don't know what measurement exactly. For ...
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1answer
36 views

Constant marginal cost for a firm and perfect competition

What happens if the demand curve is flat because the firm is a price-taker in the market, but the firm has a constant marginal cost. If the equations are the same I assume the price would be set with ...
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1answer
46 views

Why does supply equal demand? Problem if large increase of price, decreases demand only by a bit

I have looked at my coursenotes and this thread here:Why does supply equal demand?, but they did not adress, why I do not understand the law of supply and demand. The way I understand this law is the ...
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0answers
25 views

Is there a source which informs the public of who is buying up newly issued U.S. Government debt?

Is there a list somewhere of who is buying the newly issued debt that will finance the American Rescue Plan (the $1.8 trillion stimulus package signed recently)? Of course, I have an idea of who owns ...
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0answers
26 views

Competitive markets, taxation and international trade

Suppose that in a competitive market, the supply function is given by $S(p) = 5000(p-2)$ and the demand function is given by $D(p) = 2000(16-p)$. Suppose still, that in order to recompose its' budget ...
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0answers
36 views

Uncertainty and Pareto efficient policies

There are two economic agents $i\in \{1,2\}$ with state dependent utility $u_{is}=-(x-b_{is})^2$ where $x\in R$ and $b_{is}\in R$ is bliss point of $i$ in state $s\in\{1,2\}$. Assume $b_1s\lt b_{2s}$ ...
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0answers
45 views

Short, Medium and Long-Run Profit Maximization

Suppose that, in a perfectly competitive industry, the firms' technology have the following cost function: $C(x) = 100 + 3x + 0.04x^2$. Assume the fixed costs are sunken. a) If the demand for the ...
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2answers
70 views

Is the fundamental analysis also a self-fulfilling prophecy?

John J. Murphy in the first chapter of his book "TECHNICAL ANALYSIS OF FINANCIAL MARKETS" says that concerns regarding fundamental analysis being a self-fulfilling prophecy are seldomly ...
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5answers
8k views

Why do many occupations show a gender bias?

Yesterday we had a question about the alleged underpayment of women in work, asking why employers would hire fewer cheaper female workers and would instead hire a larger number of expensive male ...
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0answers
32 views

diverging price indicators

Suppose that PPI is increasing while CPI is decreasing. interpereting this is somewhat tricky because different contexts are at play: CPI is largely domestic driven while PPI has global determinants. ...
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0answers
33 views

Why Are Cargo Ships Backed Up If The US Economy Is Struggling Due To The Pandemic?

Since the start of the present pandemic, the US Congress has authorized over \$5 trillion in various forms of economic aid (Business Insider), including the just-signed $1.9 trillion American Rescue ...
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1answer
37 views

European Commission getting rid of excess carbon emission permits

According to this Economist article, For a long time after it was launched in 2005, the [European Trading System] barely functioned; a glut of allowances (which give the holder the right to emit an ...
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2answers
74 views

Competitive wages under imperfect information

Do competitive wages always have to be defined by marginal productivity? Can we have competitive wages which are not based on productivity, when the information is not perfect? To put it in context, ...
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0answers
15 views

Negotiations under expected utility maximization

A buyer is negotiating with a used car salesperson. The value of the car to the seller is uniformly distributed between 0 and 5000. Value to the buyer is 50 percent more than that of the seller (i.e. ...
2
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1answer
88 views

Why is saved money sitting on a bank account bad for the economy?

I've seen several news that were concerned about effect of the unspend savings that just sits on a bank account to the global economy. Given that bank uses to money invest in things, or simply lend ...
86
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9answers
17k views

If women are paid less for the same work, why don't employers hire just women?

If women are paid less for the same work, why don't employers hire just women? Do employers decide to lose profits just out of sexism, in feminists' and researchers' opinion? It doesn't make sense to ...