Assume that Rudolf withdraws $600 from his bank account which was earning him 10 percent interest per annum to buy a high-end digital camera. The bank interest forgone by him will be the opportunity cost of this purchase
Indicate whether the statement is true or false
T
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The above figure shows the payoff matrix for two firms. A chemical firm must choose between a low level of production which yields one ton of pollution into a nearby lake and a high level of production which yields two tons of pollution into the
nearby lake. A private beach on the lake must decide whether to operate or not. Increased pollution reduces the number of people who wish to visit the beach. If the chemical firm owns the lake, and the beach owner must pay $10 to keep the chemical firm at just one ton of pollution, then A) the beach shuts down and the chemical firm produces one ton of pollution. B) the beach shuts down and the chemical firm produces two tons of pollution. C) the beach operates and the chemical firm produces one ton of pollution. D) the beach operates and the chemical firm produces two tons of pollution.
A country that has demonstrated the ability to catch up to the technology leaders by investing in both physical and human capital is called
a. a dependent economy. b. a converging economy. c. an advancing economy. d. a predatory economy.
According to the concept of comparative advantage, a good should be produced in that nation where:
A. its domestic opportunity cost is greatest. B. money is used as a medium of exchange. C. its domestic opportunity cost is least. D. the terms of trade are maximized.
The tax cuts of 1981 and 1986
a. stimulated the economy and tax revenues increased to eliminate deficits b. stimulated the economy as supply-side economists predicted it would c. depressed the economy as supply-side economists predicted it would d. had neither a noticeable stimulating nor depressing effect on the economy e. were found to be unconstitutional and so couldn't have had the effect on the economy that the President had hoped