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The answer is hidden in your question. The company hedges to mitigate risk, to guard against excessive downturns in profit. It “pays” for this risk protection by potentially foregoing some profit. There is of course a risk-return tradeoff.

The question is interesting, provocative, and borderline polemical. Economics is not pure science. In physical science, lab experiments have repeatability and reproducibility.

Think of a bundle of goods bought at $1 in 1928. This bundle would consist of many goods. The average increase in bundle price would be $17.31 in 2022.

I appreciate your sharing your view on a specific policy issue based on the systematic application of economic concepts.

Without a doubt, demand has outpaced supply over the past 18 months.  In labor markets, there are currently 4.9 million more jobs available than there are individuals looking for work (i.e., comparing job openings from the JOLTS release to th

Without a doubt, demand has outpaced supply over the past 18 months.  In labor markets, there are currently 4.9 million more jobs available than there are individuals looking for work (i.e., comparing job openings from the JOLTS release to th

I believe the question being asked is how to calculate what an NIL deal might be worth to a college athlete?  In particular, the focus of the question also seems to be on determining what a college athlete could get paid to be a sponsor, a sp

Yes, it is as you say. A production externality is generated when the production activities of one firm adversely or positively affects the production activities of another firm.

That's a bit like asking which of your two eyes is more important. As in many cases in economics, the answer to your question is: it depends. There are markets where, at a point in time, supply is more important.

The question you asked is complicated, but I think it boils down to: “do longer commute times lead to community decline?”.

I am unaware of any discussions pertaining to a Marshall-like plan for the Russian economy presently.

The official digital Yuan issued by the central bank of China does not has the expiration date.

There is a lot in this question to digest:  the trade war, impacts by farm size, and the effectiveness of government support.  For the soybean market, the U.S.-China trade dispute did have a significant impact.  Roughly half of U.S.

How do you personally live your best life?

People sometimes have different ideas in mind when considering home price appreciation.  Most conventional discussions do not adjust for inflation.  A more nuanced consideration could account for rises in the general price level, i.e., i

Running a business is always risky, and owning an auto mechanic shop is no different. Your concern about changing technology is interesting because I see two main avenues of change.

Economics provides a framework for understanding aspects of individual and collective behavior.  In particular, economics focuses on how individuals and societies allocate resources.  Economists also offer important insights about how di

Yes, more timely inflation measures do exist.  For example, academics have used new data-gathering techniques, referred to as "big data", to create daily inflation measures; see, e.g., the Billion Prices Project (