Suppose the price of coffee is $3 each, the price of bagels is $2 each and a person's budget is $40. The person's real income is
A) $40.
B) $13.33 in terms of bagels.
C) $13.33 in terms of coffee.
D) $8.
C
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Sequential games are used to analyze
A) second-price auctions. B) cartels. C) situations in which one firm acts and other firms respond. D) firms that are subject to the prisoner's dilemma.
According to the textbook, what was Adam and Eve's economy like?
a. primitive, because technology in the Garden of Eden was non-existent b. wasteful, because Adam and Eve did not know how to use the abundant resources available c. underemployed, because there were only two workers d. there was no economy because there was no reason to economize e. the same as ours because the law of scarcity is universal
An open market sale of U.S. Treasury securities by the Fed will cause the Fed's balance sheet to show:
A. an increase in the asset category of securities and the liability category of reserves. B. a decrease in the asset of securities and a decrease in the liability of reserves. C. no change in the size of the balance sheet, just the composition of assets will change from securities to cash. D. an increase in the liability of reserves.
The higher the price elasticity, the
A. less sensitive quantity demanded is to price changes. B. more sensitive price changes are to quantity demanded. C. less sensitive price changes are to quantity demanded. D. more sensitive quantity demanded is to price changes.