Why do economists test their hypotheses?
A) to see whether people are motivated by self-interest
B) to see whether their models predict the choices people will make
C) to determine whether government policies have effectively achieved their goals
D) to learn what people are thinking when they make the choices they do
B
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Refer to Figure 7-3. With a quota in place, what is the quantity consumed in the domestic market and what portion of this is supplied by imports?
A) Domestic consumption equals 28 million pounds of which 18 million pounds are imports. B) Domestic consumption equals 34 million pounds of which 18 million pounds are imports. C) Domestic consumption equals 40 million pounds of which 22 million pounds are imports. D) Domestic consumption equals 34 million pounds of which 16 million pounds are imports.
When a firm produces 50,000 units of output, its total cost equals $6.5 million. When it increases its production to 70,000 units of output, its total cost increases to $9.4 million. Within this range, the marginal cost of an additional unit of output is
A) $41.43. B) $134.29. C) $135. D) $145.
Comparing the United States economy in the 1920s with the economy in the 1990s, both decades
A. had slow economic growth. B. had a lack of any government regulation of the stock market. C. suffered from economic depressions. D. had soaring stock markets.
According to the above figure for a gasoline market, at a price of $1 per gallon of gasoline, there would be
A) a shortage of 30 million gallons.
B) a surplus of 30 million gallons.
C) a shortage of 20 million gallons.
D) a surplus of 50 million gallons.