A market economy allocates resources primarily in accordance with orders from government bureaucrats.
Answer the following statement true (T) or false (F)
False
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The property of diminishing marginal rate of substitution follows from the property that the indifference curve is
A) downward sloping. B) upward sloping. C) bowed in toward the origin. D) bowed out from the origin.
When analyzing stages of economic development in the United States, it appears that we have entered the "tertiary stage." This is a stage marked by a shift toward
A) agriculture. B) manufacturing. C) services. D) population increases.
Credibility in threats and commitments in sequential games is based on
a. randomizing one's actions so they are unpredictable b. explicit communications with competitors c. effective scenario planning d. analyzing best reply responses e. none of the above
Suppose that consumers' preferences are well behaved in that properties 4-1 to 4-4 are satisfied. Furthermore, assume that X is a normal good, Y is an inferior good, and the price of good Y increases. Then, which of the following effects is known with certainty?
A. The income and substitution effects will reinforce one another, leading to an overall increase in the consumption of good Y. B. The income and substitution effects will have competing effects, leading to an indeterminate impact on the consumption of good Y. C. The income and substitution effects reinforce one another, leading to an overall decrease in the consumption of good X. D. The income and substitution effects will reinforce one another, leading to an overall increase in the consumption of good X.