How does the science of economics deal with the fact that we all have different values?
A) by assuming that values don't play a role in economic behavior
B) by seeking to discover the sources of different value systems
C) by using positive analysis
D) by surveying the public to see what the most common values are, and then incorporating those as assumptions into their models
C
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Economists classify all of the following as capital, except one. Which one is not capital?
a. a $20 bill in a firm's petty cash drawer b. the building where our economics class meets c. a plumber's wrench d. a railroad car e. a factory
As Reba consumes four slices of pizza, her total utility rises from 0 to 18, to 24, to 28, and to 30, respectively. What is her marginal utility of the first slice of pizza?
a. 18 b. 24 c. 2 d. 7 e. 8
When persistent inflation is present, we would expect
a. borrowers to systematically gain at the expense of lenders. b. lenders to systematically gain at the expense of borrowers. c. nominal interest rates to be higher than would be true if prices were stable. d. nominal interest rates to be lower than real interest rates.
If price rises, what happens to quantity supplied of a product?
a. It increases. b. It decreases. c. It does not change. d. Quantity supplied is constant, but supply increases.