Adam Smith's diamond-water puzzle
a. can be resolved by distinguishing between marginal and total utility.
b. occurs because diamonds have no utility.
c. occurs because scarcity increases total utility.
d. will likely never be resolved with existing economic tools.
a
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An open market sale by the Fed causes the value of the dollar to
A) fall, increasing net exports. B) rise, reducing net exports. C) fall, reducing net exports. D) rise, increasing net exports.
Government spending in the United States has grown over time and now accounts for more than forty percent of United States national income. Does this mean that government has been consistently running a budget deficit?
What will be an ideal response?
Max has allocated $100 toward meats for his barbecue. His budget line and an indifference map are shown in the above figure. What happens if Max receives a $100 cash grant to buy either meat or chicken?
A) Max will double his consumption of both meats. B) Max will spend it all on burger. Because of its lower price, he can buy more of it. C) Max will take advantage of the gift by buying all chicken because it is the more expensive meat. D) There is not enough information to answer the question.
Exhibit 5-6 Demand curve for concert tickets
?
In Exhibit 5-6, the demand curve for concert tickets shown above between the prices of $20 and $30 is
A. inelastic. B. elastic. C. unitary elastic. D. cross elastic.