The following accompanying table shows the relationship between the speed of a computer's CPU and its benefits and costs. Assume that all other features of the computer are the same (that is, CPU speed is the only source of variation), and only the CPU speeds listed below are available for purchase. CPU GHzTotal BenefitMarginal BenefitTotal CostMarginal Costs2.0$1,000 $900 2.5$1,400 $1003.0 $300$1,200 3.5$1,900 $1,500 4.0$2,000 $400 Application of the Cost-Benefit Principle would lead one to purchase a ________ computer.
A. 4.0GHz
B. 3.0GHz
C. 2.5GHz
D. 2.0GHz
Answer: B
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A) the interest rate you are paid on your currency increases. B) the opportunity cost of holding money decreases. C) your marginal tax rate falls. D) the marginal benefit of holding money decreases. E) you earn a lower rate of interest on your checkable deposit.
According to Keynes, an unbalanced budget is appropriate in all of the following situations except when
A. The economy is at full employment. B. Leakages and injections are out of balance. C. The economy is below full employment. D. Macro equilibrium is above full employment.
If inflation in the rest of the world is lower than inflation in Brazil, Brazil's currency (the real) would tend to appreciate
Indicate whether the statement is true or false
Economists assume that individuals
A) behave in unpredictable ways. B) will never take actions to help others. C) prefer to live in a society that values fairness above all else. D) are rational and respond to incentives.