Opportunity cost is defined
a. only in terms of money spent
b. as the value of all alternatives not chosen
c. as the value of the best alternative not chosen
d. as the difference between the benefits from a choice and the benefits from the next best alternative
e. as the difference between the benefits from a choice and the costs of that choice
C
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The policy shown in Figure 9.7 is a
A) price floor of $50. B) price support of $50. C) price ceiling of $30. D) quota of 2000. E) quota of 4000.
The dramatic increase in the standard of living since the Industrial Revolution
A. means that societies and individuals face no constraints. B. has not meant unlimited abundance for societies or persons. C. means that “opportunity cost” is a meaningless concept. D. has reduced the choices open to persons. E. has made economics less useful to persons.
According to the quantity theory of money, the inflation rate equals
A) the money supply minus real output. B) the growth rate of the money supply minus the growth rate of real output. C) real output minus the money supply. D) the growth rate of real output minus the growth rate of the money supply.
The abnormal net income model
A) assumes that economic profits cannot be earned in the short run. B) assumes that economic profits cannot be earned in the long run. C) employs economic profit in its valuation of a firm. D) none of these choices.