The Consumer Price Index excludes all of the following, except one. Which one is included in the CPI?
a. Services purchased directly by consumers
b. Raw materials
c. Services purchased by the government
d. Machinery purchased by firms
e. Intermediate goods purchased by firms
A
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Alex received a four-year scholarship to State U. that covered tuition and fees, room and board, and books and supplies. If Alex becomes a full-time student, then:
A. the opportunity cost of attending State U. includes the sum of the benefits Alex would have had from attending each of the other schools to which he was admitted. B. Alex has no incentive to study hard while at State U. C. the opportunity cost of attending State U. includes the money Alex could have earned working for four years. D. attending State U. for four years is costless for Alex.
What effect would an increase in the price of pork have on the demand for beef?
A) It would decrease the demand for beef. B) It would decrease the demand for beef only if the demand for beef is elastic. C) It would increase the demand for beef. D) It would increase the demand for beef only if the demand for beef is inelastic. E) It would have no effect, because a change in price affects only the quantity demanded, not the demand.
Easterlin (1968, 1987) argues that as the relative price of children rises,
(a) the average household demands fewer of them. (b) society, at large, demands fewer of them. (c) society, at large, demands more of them. (d) nothing happens since the demand for children is not influenced by price.
A firm has a fixed cost of $2,000, and at an output of one, variable cost is $1,500. How much is marginal cost at an output of 1?
A. $1,000 B. $1,500 C. $2,000 D. $3,500