If an individual consumes more of Good X when his/her income doubles, we can infer that
A. Good X is an inferior good.
B. the demand for Good X is perfectly inelastic.
C. the individual is highly sensitive to changes in the price of Good X.
D. Good X is a normal good.
Answer: D
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Differences in innate skills and the benefits associated with the division of labor result in
A) diminishing returns. B) self-sufficiency. C) absolute advantage. D) differences in productivity.
Refer to the scenario above. If the individual places his bet on four pockets, his likelihood of winning is:
A) 1%. B) 4%. C) 8%. D) 10%.
The market overproduces goods that have external costs because producers:
A.) Do not experience the full costs of production for these goods. B.) Must bear higher costs than society experiences for these goods. C.) Expect the government to subsidize these goods. D.) Cannot compete with the government in producing these goods.
All of the following are examples of capital except:
A. the robot used to help produce your car. B. the classroom in which you learn. C. the factory that produces the costume jewelry you buy. D. an uncut diamond that you discover in your backyard.