Suppose you go out with your friend for coffee and donuts at the local donut store. The first donut you eat tastes incredibly good. The second one also tastes pretty good. The third donut seems just okay. With the fourth donut you are turning somewhat green. The fifth donut makes you sick. Your friend, an economist, describes your experience as the principle of:
a. utility maximization.
b. irrationality in consumer behavior.
c. instant gratification.
d. differing tastes and preferences.
e. diminishing marginal utility.
e
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In a country with a working-age population of 150 million, 120 million workers are employed and 10 million workers are unemployed. What is the size of the labor force?
A) 150 million B) 130 million C) 120 million D) 10 million
A key to creating effective policy to fight poverty is to understand:
A. why people are poor. B. the correlation between education and income. C. the correlation between income and geographic location. D. the unintended consequences of reductions in the incentive to work.
The economic system characterized by private ownership of resources and market is:
a. capitalism. b. communism. c. fascism. d. socialism.
An economy with an expansionary gap will, in the absence of stabilization policy, eventually experience a(n) ________ in the inflation rate, leading to a(n) ________ in output.
A. decrease; increase B. increase; increase C. decrease; decrease D. increase; decrease