From an economic perspective, when consumers leave a fast-food restaurant because the lines to be served are too long, they have concluded that the:
A. Marginal cost of waiting is less than the marginal benefit of being served
B. Marginal cost of waiting is greater than the marginal benefit of being served
C. Management is exhibiting irrational behavior by not maximizing profits
D. Management is making an assumption that other things are equal
Answer: B
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Which one of the following is an example of discretionary fiscal policy used to correct an inflationary gap?
A) an increase in government expenditures approved by Congress B) decrease in the money supply by the Federal Reserve C) a tax increase passed into law by Congress D) an agreement among major banks to lower interest rates
An income tax system in which the average tax rate decreases with the level of income is called a
A) progressive income tax system. B) proportional income tax system. C) regressive income tax system. D) flat-rate income tax system.
If Dell Computer finds that its marginal cost exceeds its marginal revenue on a model of laptop, then to maximize profit, it will
a. increase output if it is a price searcher, but this may not be proper if it is a price taker. b. increase output if it is a price taker, but this may not be proper if it is a price searcher. c. decrease output, regardless of whether it is a price taker or a price searcher. d. increase output, regardless of whether it is a price taker or a price searcher.
The natural rate of unemployment
A. increases during recessions. B. equals the sum of frictional and cyclical unemployment. C. equals the sum of frictional and structural unemployment. D. is always less than full employment rate of unemployment.