Would the customer be able to convince the shopkeeper that he would walk out if he receives a high price?
a. Yes, because walking out is most profitable move for the customer
b. No, because walking out is an unprofitable strategy for the customer
c. No, because walking out is not a credible threat
d. Both B&C
d
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If an increase in x (the variable on the horizontal axis) from 6 to 8 units causes a decrease in y (the variable on the vertical axis) from 4 to 3 units, the slope equals
A) 2. B) -2. C) 1/2. D) -1/2.
An increase in the interest rate would induce people to
A) sell shares of stock and buy bonds, but would have no effect on their desire to hold money. B) get rid of all their money and buy stocks with it. C) sell their least liquid assets and hold more money in case interest rates go up again. D) hold a smaller fraction of their wealth in the form of money.
In purchasing diamonds and water, a consumer would maximize utility by
a. dividing expenditure equally between those two goods b. equating the marginal utilities from each of those two goods c. equating average utility per diamond with average utility per unit of water d. equating the total utility per diamond with the total utility per unit of water e. equating marginal utility per dollar spent on each of those two goods
The expenditure method dictates that GDP is equal to C + I + G + (X M)
a. True b. False Indicate whether the statement is true or false