Voters are making a choice to spend money on three projects: a dam, a school, or a road. In the choice between the dam and the school, the majority favors the school. In a choice between a dam and a road, the majority favors a dam. In a choice between a road and a school, the majority favors a road. These rankings indicate that majority voting may:
A. Result in economically efficient outcomes because of rent-seeking behavior
B. Reflect irrational preferences
C. Produce inconsistent choices
D. Lead to consistent choices in spite of irrational community preferences
C. Produce inconsistent choices
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Checks that people write are
A) the largest component of the money supply. B) not money. C) only part of M2 but not part of M1. D) part of M1 but not part of M2.
The ratio of consumption to income is known as ________
A) the average propensity to consume B) the borrowing constraint C) the marginal propensity to consume D) subprime accommodation
One reason for computing the logarithms (ln), or changes in logarithms, of economic time series is that
A) numbers often get very large. B) economic variables are hardly ever negative. C) they often exhibit growth that is approximately exponential. D) natural logarithms are easier to work with than base 10 logarithms.
If a country has a lower opportunity cost in producing a good than its trading partners, then it has:
A. A comparative advantage in producing the good. B. Favorable terms of trade in producing the good. C. An absolute advantage in producing the good. D. Lower labor costs in producing the good.