If forecasting errors are rational, then
A) people will always be error-prone.
B) they will be random, and thus independent of previous errors.
C) they will be independent of business firm production and price forecasts.
D) A and C are both correct.
B
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The demand for apple pies is perfectly elastic. If the government taxes apple pies at $1 a pie, then
A) the seller pays the entire tax. B) the buyer pays the entire tax. C) the seller and the buyer split the tax evenly. D) the seller and the buyer split the tax but the seller pays more. E) who pays the tax depends on whether the government imposes the tax on pie buyers or on pie sellers.
How did the increase in the interest rates in the early 80s contribute to the S&L crisis?
What will be an ideal response?
The following accompanying table shows the relationship between the speed of a computer's CPU and its benefits and costs. Assume that all other features of the computer are the same (that is, CPU speed is the only source of variation), and only the CPU speeds listed below are available for purchase. CPU GHzTotal BenefitMarginal BenefitTotal CostMarginal Costs2.0$1,000 $900 2.5$1,400 $1003.0 $300$1,200 3.5$1,900 $1,500 4.0$2,000 $400 The marginal benefit of upgrading from a 2.0GHz computer to a 2.5GHz computer is:
A. $100. B. $1,400. C. $1,000. D. $400.
Price fixing is an arrangement whereby firms agree to:
A. set price equal to marginal revenue. B. set price equal to marginal cost. C. set price equal to average total cost. D. coordinate their pricing decisions.