1. What makes demand curves inelastic or elastic? Give examples of products that are likely to have elastic demands and those that are likely to be inelastic. Why would any seller want to know whether the demand curve they face is elastic or inelastic?
2. Why might a multinational corporation with identical plants in different countries pay different wage rates to workers in the two countries even though their skill levels are the same? Does this strike you as unjust? Why might the higher paid workers object? In which country would the factory operators employ more sophisticated and productive machinery?