Assume that an individual has to decide between a two-day vacation and a three-day vacation to the same place. If he uses optimization in differences, he will:
A) only think about the net benefits of the extra day.
B) compare the total net benefits of both alternatives.
C) choose the three-day vacation only if the costs incurred on the third day exceed the benefits he receives.
D) spend more time to come to a decision than if he would have used optimization in levels.
A
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Spot market is to futures market as
A) rice is to beans. B) today is to tomorrow. C) squares are to circles. D) quarters are to dollars.
The unemployment rate is computed by ________
A) dividing labor force by the adult population B) dividing the number of unemployed by the adult population C) multiplying the employment ratio by the adult population D) dividing the labor force by the number of unemployed E) none of the above
Assuming the economy is represented by the graph shown, if the government were to enact a partially successful expansionary fiscal policy, it would be most likely to move from equilibrium:
A. A to B.
B. B to A.
C. D to C.
D. D to B.
A period of significant decline in economic activity, marked by falling GDP, rising unemployment, and an increased number of bankruptcies, is called:
A. a boom. B. a recession. C. an expansion. D. a severe depression.