Imagine that a high school junior received a bonus check from his boss on the last day of his summer job. He decides to save all of that bonus check to pay for his senior trip coming up next year instead of purchasing a much needed new automobile. From an economist’s perspective, which of the following statements about this decision is likely to be true?
Answer: The decision is rational in the sense that it reflects the junior's preference for a senior trip over new automobiles.
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Interdependence of firms is most common in
A) oligopolistic industries. B) monopolistically competitive industries. C) monopolistically competitive and oligopolistic industries. D) monopolistic industries.
"Medium term notes" have a maturity ranging up to
A) one year. B) two years. C) five years. D) ten years.
Consider a nation experiencing the relationship illustrated by the short-run Phillips curve. An increase in both unemployment and inflation in this nation over the next ten years can be explained by:
a. a downward movement along the short-run Phillips curve. b. a series of outward shifts of the short-run Phillips curve. c. an upward movement along the short-run Phillips curve. d. a series of inward shifts of the short-run Phillips curve. e. a complete change in the slope of the Phillips curve.
Suppose a policy change generates $90,000 of benefits for low-income families and $150,000 of costs for high-income families. We can best describe the change as
A. equitable. B. potentially efficient. C. inefficient. D. Pareto efficient.