Solved Questions

Why is agricultural productivity in developing countries usually so low?

What are the gains from international trade, and why might countries still decide to trade even if no country has a comparative advantage?

Explain how rent seeking can lead to a drop in production of goods and services. What role might the underground economy play in lessening any drop in productive activities?

In a single-issue majority vote, such as the TV example in this chapter, does the median voter always get his or her most preferred outcome?

Major political parties typically offer "middle of the road" platforms rather than take extreme positions. Is this consistent with the concepts of the median voter and rational ignorance discussed in this chapter?