Total cost includes:
A. the amount the firm spends on all inputs that go into the production of a good or service.
B. one-time expenses and ongoing expenses.
C. forgone opportunity costs.
D. All of these are true.
Answer: D
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Because of specialization and comparative advantage, most people
a. consume only what they produce themselves b. consume the products produced by their family and friends c. consume the products of many other specialists d. do not use money as a medium of exchange e. share whatever they produce
Which of the following is most important for the achievement of long-term prosperity and strong economic growth?
a. expansionary monetary policy b. expansionary fiscal policy c. price stability d. a balanced federal budget
People interpret evidence to confirm beliefs they already hold. This statement is an example of which of the following systematic mistakes that people make?
a. people are overconfident b. people give too much weight to a small number of vivid observations c. people are reluctant to change their minds d. All of the above are correct.
When one side of a market knows more about a product than the other side, the moral hazard problem is experienced
Indicate whether the statement is true or false