Part A

Question 1
My comment how William Jevon explained the scenario gap between payments for school
teachers and professional athletes with regard to the Water-Diamond Paradox puzzle is
explained that economic decision-making is based on every diamond in the world profit is
made instead of profit. Obviously, compared with the luxury of owning diamonds, water is a
more important resource. As demand increases, consumers must choose between
complementary diamonds or additional water unit. This principle is called marginal utility.
so, all teachers are probably valued more highly than all athletes. Yet the marginal value of
one extra athlete quarterback is much higher than the marginal value of one additional
teacher.
Question 2
a) In the classical model, There is only one way that changes in the money supply will
affect production, and such changes may surprise people. Unexpected changes will
not affect expectations, so the short-term aggregate supply curve will not move in the
short term, and events will develop as in the panel. Monetary policy can affect
production, but only if it surprises people.
b) Smith and Ricardo attracted many people and wealth on the edge. This is important to
be necessary, but this is important, this is important, especially, as a new one to
decide which does not provide specific information. Unbearable items in economic
principles
Question 3
Demand elasticity is the rate of change of demand caused by changes in invariants that affect
demand. These invariants can be the price of the product, consumer income, and the price of
other related commodities. According to Marshall, whether the elasticity or responsiveness of
market demand is large or small depends on whether the demand is large or small when a
given price falls; and with a certain price increase, it will drop sharply or slightly.
Question 5
The classical theory of interest and employment is formed from two frameworks. the loanable
funds market and therefore the aggregated labour market. The loanable funds market, and
particularly provides the classical school with a theory of aggregate demand. Supply creates
its own demand, savings fund investment and therefore the loanable funds market guarantees
the system effectively self-adjusts to any economic shocks. But aggregate demand does not
play a task in determining employment. Classical economists upgrade the analysis of Smith
and Ricardo to include an aggregated labour market. On this economy-wide market the
equilibrium volume of employment is decided by the forces of aggregate labour demand and
aggregate labour supply responding to real wage rates.