Does the principle of optimization imply that people always make the best choices?
What will be an ideal response?
Optimization is a good description of almost all human behavior, but this doesn't mean that people are always perfect calculators. Our decisions are roughly equal to the choices we would make if we always optimized. To an economist, optimization is a good approximation of the decisions that people make.
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Because a price setter has control over both the level of output it produces and the price it charges, it can select from a number of different combinations of output and price levels that will maximize its profits
Indicate whether the statement is true or false
The unemployment rate:
A. is measured by the number of people who are unemployed divided by the labor force. B. measures what percentage of our labor force is currently looking for a job and can't find one. C. is never zero. D. All of these are true.
Which of the following is NOT true of utility?
A. It represents the want-satisfying power of a good. B. The utility that a good provides depends on a consumer's preferences. C. Utility can be measured objectively. D. It is measured using a representative unit called a util.
When you buy newly-issued shares of Snap stock, this transaction takes place in the
A) primary market. B) bond market. C) secondary market. D) bear market.