Which example is most likely an economic assumption?
a. Ninety percent of people act out of self-interest.
b. All people act out of self-interest.
c. Ninety-five percent of companies decide to maximize profits.
d. Ninety-five out of 100 companies decide to maximize profits.
b. All people act out of self-interest.
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The following table provides data for an economy in a certain year.Consumption expenditures1,000Imports600Government purchases of goods and services700Construction of new homes and apartments500Sales of existing homes and apartments600Exports500Government payments to retirees200Household purchases of durable goods300Beginning-of-year inventory500End-of-year inventory600Business fixed investment300Given the data in the table, compute the government purchases component of GDP.
A. 700 B. 900 C. 500 D. 200
Assume that a combination of 10 bottles of wine and 2 cartons of milk lies on a consumer's budget constraint. If the price of one bottle of wine is $10, and one carton of milk is $1, what is the consumer's income?
A) $100 B) $20 C) $120 D) $102
A cartel price will be established at the quantity where
A) total cost equals the industry total revenue. B) average cost equals the industry revenue. C) the sum of the members' marginal costs equals industry marginal revenue. D) marginal cost equals industry price.
What could happen to render the price ceiling set in the graph shown non-binding?
A. Demand could increase, and shift to the right.
B. Demand could decrease, and shift to the left.
C. Supply could decrease, and shift to the left.
D. None of these would cause the price ceiling to be non-binding.