Sadie just bought a new karaoke machine to replace her old one. Her old one works perfectly fine and would sell on Craigslist for $50. The fact that Sadie would not pay $50 for it, yet continues to let it sit in her closet unused is explained by:
A. the implicit cost of ownership.
B. the cost of admitting she likes karaoke.
C. ignored sunk costs.
D. irrationally considering sunk costs.
A. the implicit cost of ownership.
You might also like to view...
If the U.S. Congress passes legislation to raise taxes to control demand-pull inflation, then this would be an example of a(n)
A. supply-side fiscal policy. B. contractionary fiscal policy. C. expansionary fiscal policy. D. nondiscretionary fiscal policy.
Assume a monopolist charges a price corresponding to the intersection of the marginal cost and marginal revenue curves. If this price is between its average variable cost and average total cost curves, the firm will:
a. earn an economic profit. b. continue to operate in the short run. c. shut down. d. all of these are true.
If Britain allows the pound-DM (Deutsche Mark) exchange rate to float, and there is an increase in the foreign interest rate, it:
A) has no effect on home rates. B) will cause a monetary contraction and a higher interest rate in Britain. C) will eventually decrease if trade is affected. D) always shifts out the home IS curve (Britain), all else equal.
The deposit multiplier is the inverse of
A) legal reserves. B) excess reserves. C) checkable deposits. D) the required reserve ratio.