Jack has a ticket to see Daughtry for which he paid $30 yesterday. He takes an unpaid day off from work to get ready for the concert. When he arrives at the concert, five different people offer him $70 for his ticket. Jack decides to keep his ticket. At the time he makes this decision, his opportunity cost of seeing Daughtry is:
A. $70 plus his forgone earnings.
B. $30 plus his forgone earnings.
C. $70.
D. $40.
Answer: C
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The principle of minimum differentiation reflects the
A) tendency for firms to produce at minimum marginal cost in order to compete with one another. B) tendency for political parties to make themselves identical to appeal to the median voter. C) concept of minimizing the difference between total benefit and total cost to produce efficiently. D) attempt to minimize the free-rider problem.
In the view of the new classical economists, an increase in the money stock will affect real output and employment only if the increase in the money stock
a. was caused by an aggregate supply shock. b. is accompanied by an expansionary fiscal policy shift. c. was anticipated. d. was unanticipated.
Providing housing decreases the incentive for the poor to find their own.
A. True B. False C. Uncertain
If two firms expect to be in the market together for a long time, the benefit of underpricing will be large relative to the cost.
Answer the following statement true (T) or false (F)