If the price were $60, this firm would _________ in the short run and __________ in the long run.
A. shut down; stay in business
B. shut down; go out of business
C. operate; stay in business
D. operate; go out of business
C. operate; stay in business
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The calculation of GDP excludes the value of
A) government expenditure on office supplies. B) households' purchases of shampoo. C) businesses' purchase of new machine tools. D) a family member painting the family home. E) expenditure on durable goods.
Suppose that in year 1 every adult in the country works 40 hours a week and GDP is $6.7 trillion. In year 2 every adult in the country works 45 hours a week and GDP is $7.5 trillion. Which of the following statements is true?
A) Per-capita GDP is necessarily higher in year 2 than year 1. B) People are "better off" in year 2 than in year 1 because there are more goods and services in year 2 than year 1. C) Government transfer payments were higher in year 2 than in year 1. D) a and b E) none of the above
Shelly purchases a leather purse for $400. One can infer that:
A. her reservation price was exactly $400. B. she paid too much. C. her reservation price was less than $400. D. her reservation price was at least $400.
Lulu did not vote in the last election. When Ari asked her why, she said, “None of the candidates thinks like I do, and there are so many voters that what I want and my vote don’t matter. I’m not wasting my time playing a game and throwing away my vote.” What would a public choice economist say about Lulu?
a. She lacks basic logic. b. She is a traitor. c. She does not understand economics. d. She is rationally ignorant.