In preparing for an examinations in economics, it is desirable to study
the economy for years and thus acquie a feel for the facts. See how realistic
insight helps on this one:
7. If a tax of three cent per unit is imposed on the product of a
perfectly competitive industry, the price will rise bt exactly three
cents.(Answer: F)*4
The statement is false for three reasons" there are no perfectly
competitive industries; if there were, they would not be constant-cost
industry; and if there were, they wouldn't raise the price of a locomotive by
just three cents.
Lesson 4: Know Your Economy
Even a good student will sometimes overlook a section of the economy or
the textbook. Even so, formal logic may come to his rescue:
10. Although therotically, the control of a corporation is vested in all
its owners, in actual fact the control of most corporations rests with
their elected directors.(Answer: T)*5
Remember page58: "Theory and practice should not contradict one another."
So if in theory thw owners controls the corporation, then in fact they do; if
in fact the directors control the corporations, then in theory they do. Hence,
owners and directors are identical. Once we know this, the answer follows
directly.
Lesson 5 : Know Your Logic.
*4: Ibid., p.63.
*5: Ibid., p.11 Tarshis or Tarshis and Cartweight, are probably the only
economists who have studied the distribution of control in hundreds and
thausands of corporations. T or F?
--
the economy for years and thus acquie a feel for the facts. See how realistic
insight helps on this one:
7. If a tax of three cent per unit is imposed on the product of a
perfectly competitive industry, the price will rise bt exactly three
cents.(Answer: F)*4
The statement is false for three reasons" there are no perfectly
competitive industries; if there were, they would not be constant-cost
industry; and if there were, they wouldn't raise the price of a locomotive by
just three cents.
Lesson 4: Know Your Economy
Even a good student will sometimes overlook a section of the economy or
the textbook. Even so, formal logic may come to his rescue:
10. Although therotically, the control of a corporation is vested in all
its owners, in actual fact the control of most corporations rests with
their elected directors.(Answer: T)*5
Remember page58: "Theory and practice should not contradict one another."
So if in theory thw owners controls the corporation, then in fact they do; if
in fact the directors control the corporations, then in theory they do. Hence,
owners and directors are identical. Once we know this, the answer follows
directly.
Lesson 5 : Know Your Logic.
*4: Ibid., p.63.
*5: Ibid., p.11 Tarshis or Tarshis and Cartweight, are probably the only
economists who have studied the distribution of control in hundreds and
thausands of corporations. T or F?
--
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