What is the basic assumption underlying the model of choice?
The model of choice starts by assuming that people want to make themselves as well off
as possible. In other words, people try to maximize utility.
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Explain how a government budget deficit might crowd out private investment
What will be an ideal response?
The "fair results" view of fairness says that a minimum wage law set above the equilibrium wage rate is unfair because the minimum wage
A) does not apply to all workers. B) boosts the income of highly skilled workers. C) benefits only those workers who are able to find and keep a job. D) benefits nobody. E) cannot be enforced.
A record of all transactions between residents of the reporting country and residents of the rest of the world over a period of time is called the:
A) national income product accounts. B) balance of payments accounting system. C) accrual accounting system. D) none of the above.
The textbook reveals the secret of French cuisine. It is that
a. French food is highly nutritious and its taste creates high total utility b. they provide only small portions of many courses so that the marginal utility of each course is high c. they provide large portions of few courses so that the total utility of the meal is high d. they provide large portions of many courses so that both the marginal and total utility of each course offered in the meal is high e. time matters; the French meal lasts for hours, increasing the total utility of the meal