Consider two coupons: one offers 10 percent off a pair of jeans that costs $100, and the other offers 50 percent off a pair of sunglasses that costs $20. Using either coupon requires driving to the shopping mall across town. According to the Weber-Fechner law, which coupon will people tend to perceive as being more valuable?
A. The coupon for the jeans since $100 is greater than $20.
B. They will be seen as equally valuable since both lead to a savings of $10.
C. The coupon for the sunglasses since 50 percent is greater than 10 percent.
D. Neither coupon will be of value to anyone since both require driving across town.
Answer: C
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One implication of the Phillips curve analysis is that: a. unemployment rates below the natural rate are only possible in the long run
b. unemployment rates below the natural rate lead to falling rates of inflation in the long run. c. if inflationary expectations are accurate, the economy is on the short-run Phillips curve but not on the long-run Phillips curve. d. unemployment rates below the natural rate may be achieved only with rising inflation rates. e. the natural rate of unemployment is strictly a short-run phenomenon.
Ceteris paribus means
A) other variables are held constant. B) almost certainly. C) only if everything works just right. D) perhaps.
Kate and Alice are small-town ready-mix concrete duopolists. The market demand function is Qd = 20,000 - 200P, where P is the price of a cubic yard of concrete and Qd is the number of cubic yards demanded per year. Marginal cost is $80 per cubic yard. The Cournot model describes the competition in this market. What is Kate's marginal revenue function?
A. MR = 100 - 0.005QK - 0.01QA B. MR = 100 - 0.005QA - 0.005QK C. MR = 100 - 0.005QA - 0.01QK D. MR = 100 - 0.005QK - 0.005QA
Which of the following would cause an increase in the market supply of drones?
A. an increase in the number of firms making drones B. an increase in the cost of components used to make drones C. an increase in taxes levied on drones D. a decrease in the demand for drones