In the economic way of thinking, individuals make "choices" only when they
A) follow their narrow, selfish interests.
B) enjoy perfect and complete information about the consequences of their actions.
C) act responsibly.
D) pursue one project while sacrificing another.
E) have mastered the lessons of economic theory.
D
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Smith and Jones comprise a two-person economy. Their hourly rates of production are shown in the accompanying table. Calculators Per HourComputers Per HourSmith10010Jones1206 If Smith and Jones are dividing their time efficiently and producing more than 10 computers and fewer than 120 calculators per hour, then Smith will ________ and Jones will ________.
A. produce only computers; split his time between computers and calculators B. produce only calculators; produce only computers C. split his time between computers and calculators; produce only computers D. produce only computers; produce only calculators
Figure 16-1
In Figure 16-1, there are four levels of income. G is government expenditures and TT is taxes less transfers. Y3 is the full-employment level of income. At Y3
a.
there is an official deficit but a structural budget balance.
b.
there is a structural deficit but an official budget surplus.
c.
the official and structural deficit are in balance.
d.
both the official and structural budgets show a deficit.
Under the liquidity premium theory a flat yield curve implies:
A. long-term interest rates are higher than short-term interest rates. B. there is no risk premium for longer-term maturities. C. short-term interest rates are expected to remain constant. D. short-term interest rates are expected to decrease.
Clothing retailers have faced greater competition in recent years as more firms have entered the clothing market. Some of the competition has come from foreign competitors, but much of it is domestic competition
As a result there is much competition in markets for many types of clothing and A) individual buyers and sellers cannot affect the market price because it is determined by the market forces of demand and supply. B) there are no other implications. C) firms have a great degree of flexibility in pricing their products because these products can be sold at a high profit level. D) there are relatively few buyers and sellers in the market, and one individual firm can determine the market price.