Which of the following is an example of price discrimination?
a. $6 foot-long subs at Subway
b. Little Roman's pizza menu with the following prices: cheese pizza = $8, supreme = $11
c. the McPick 2 menu at McDonald's
d. airlines charging lower prices for those who book in advance
d. airlines charging lower prices for those who book in advance
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Bobby is offered a job as a salesperson in which there is a 50 percent chance that he will make $2,000 and a 50 percent chance that he will make $10,000. Bobby's utility of wealth curve is shown in the figure above. What is Bobby's cost of risk?
A) $1,000 B) $2,000 C) $3,000 D) $4,000
In long-run equilibrium, a monopolistically competitive firm will produce
a. at the minimum average cost b. at full capacity c. along the downward-sloping portion of its ATC curve d. along the upward-sloping portion of its ATC curve e. at the minimum of marginal cost
The Fed has which of the following as its strongest control over the money supply?
a. interest rate changes b. the discount rate c. open market operations d. the required reserve rate
Which one of the following decisions most clearly reflects a lack of understanding of the concept of sunk costs?
a. You pay to have your car towed back to the repair shop because it was not fixed properly the first time. b. You decide to get a master's degree because you cannot find a job in the field in which you majored. c. You decide to purchase a piece of machinery for your business that will eliminate three employees' positions. d. You study eight hours for a final exam even though there is no way now that you can pass the course.