Saturday afternoon you can either attend a street festival, work and earn $100, or study for your midterm exam. You flip a coin between the street festival and studying, but did not really consider working. The coin flip determined that you would stay home and study. The opportunity cost of the time spent studying includes:
A. The time you spent deciding upon using a coin flip to determine your Saturday afternoon activity.
B. earning a high score on your midterm.
C. the loss of $100 worth of wages and going to the street festival.
D. the benefit that could have been received at the street festival.
Answer: D
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Social Security was intended to
A. cover all of the income necessary for retirement. B. provide a safety net of retirement income to which recipients would add their savings and pensions. C. provide retirement income for only those without private pensions. D. provide retirement income for only those who did not save for themselves.
An optimal decision is one that chooses
A. the most desirable alternative among the possibilities permitted by the resources available. B. the lowest cost method of meeting goals, without regard to quality or any other feature. C. among various possible goals and offends no one, so that all are equally happy. D. among equally important goals, and thereby avoids the “indispensable necessity” syndrome. E. among possible goals in such a way that spends as little money as possible.
What are the major components of the current account in the balance of payments? How is the current account balance determined?
What will be an ideal response?
If MUx/Px > MUy/Py, then
A. X is more expensive than Y. B. spending a dollar less on Y and a dollar more on X increases utility. C. spending a dollar less on X and a dollar more on Y increases utility. D. Y is more expensive than X.