Which of the following statements is true?
A) Optimization requires individuals to foresee the future perfectly.
B) An optimizing individual need not consider the risks involved in various choices.
C) An optimizing individual is also likely to exhibit rationality.
D) The less information that is available, the easier it is to make optimal decisions.
C
You might also like to view...
Classical growth theory predicts that economic growth
A) is merely an illusion. B) will continue at the classical rate of 3 percent forever. C) occurs because of hard-working citizens. D) decreases the supply of labor. E) will eventually stop because of population growth.
If Mark's marginal utility per dollar spent on the last taco is 15 and his marginal utility per dollar spent on the last burrito is 20 units, what should Mark do to increase his total utility?
What will be an ideal response?
Refer to Table 4-6. The table above lists the marginal cost of polo shirts by Marko's, a firm that specializes in producing men's clothing. If the price of polo shirts increases from $15 to $20
A) the marginal cost of producing the third polo shirt will increase to $20. B) there will be a surplus of polo shirts. C) producer surplus will rise from $13 to $28. D) consumers will buy no polo shirts.
Why are real interest rates more important than nominal interest rates with regard to analyzing the supply and demand of loanable funds?