Suppose the U.S. government encouraged consumers to trade in their old automobiles for more efficient, new models by paying up to $5,000 for the old automobiles
These consumers who did trade in their old automobiles to take advantage of the government offer would be exemplifying the economic idea that
A) people are rational. B) people respond to economic incentives.
C) optimal decisions are made at the margin. D) equity is more important than efficiency.
B
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Which of the following statements about the nominal and the real wage rates is correct?
A) The nominal wage rate equals the real wage rate divided by the CPI and then multiplied by 100. B) The nominal wage rate is measured in the dollars of a base year. C) The real wage rate is measured in current year dollars. D) The real wage rate indicates how many goods and services can be purchased with an hour's labor. E) The real wage rate equals the nominal wage rate multiplied by the CPI then divided by 100.
The hypothesis that people attempt to stabilize their consumption over their entire lifetime is the
A) life cycle hypothesis. B) forward looking expectation hypothesis. C) permanent-income hypothesis. D) None of the above.
A factor of production that cannot be easily changed in the relevant time period is called a
A) short-run factor. B) fixed input. C) variable input. D) production anchor.
A worker's labor supply depends on, among other things, his ability, his preference for the task, and the opportunity cost of his time
a. True b. False