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No country has an absolute advantage in producing cars as the car producing capacity is same for both the country. However, with regards to grain, it is apparent that by using the same amount of resources, the output for a Australian worker is higher in comparison with the Japanese worker. Hence, it would be apt to conclude that Australia has the absolute advantage in producing grain.
The comparative advantage in producing g...
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Panopticism is a socio-theoretical and communal framework which was introduced by Michel Foucault, a French philosopher. The framework was named after Panopticon which is a model for external surveillance (Gane, 2012). Panopticon refers to the external laboratory of power with the application of which attitude and behaviour of individuals can be modified for the better and is considered to be a disciplinary cou...
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In game theory one strategy is said to dominate another strategy if it provides a higher pay off to the player irrespective of strategy choice of opponent. Player A has three strategies Top, Middle and Bottom. Player B ha...
Economics is significant in explaining the complex contemporary issues. It further describes the economic behavior of different economic issues. It requires social intervention to address the market failures where the market fails to correct itself. In this case, the government intervenes using various policy measures. Therefore, a clear understanding of the appropriate policy measures can help to address the existing ...
Per unit tax is a fixed amount of tax, imposed on a seller, for each unit of product it sells. Hence, it is proportional to the certain amount of product sold, without considering price. Hence, total price of a unit of output increases and this shifts the supply curve upward (Borck and Brueckner 2018).
Figure 1: deadweight loss after imposition of per-unit tax
Source: (created by author)
The above figure has represented...
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