Which of the following is part of the economic way of thinking?
a. When an option becomes less beneficial, individuals will become more likely to choose it.
b. Costs are incurred whenever scarce resources are used to produce goods or services
c. The value of a good is determined by its cost of production.
d. Both a. and b. are part of the economic way of thinking.
b
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The long-run aggregate supply (LAS) curve
A) has a positive slope. B) has a negative slope. C) is vertical. D) is horizontal.
Suppose maple syrup is illegal in the country of Pancake. If there are two ways to smuggle maple syrup into Pancake: one through overland and one by sea. If the proud Pancakian coast guard is able to arrest all who attempt to smuggle syrup by sea, what would the theory of rent predict?
A. The production costs of smuggling syrup by sea will fall to zero as the use of the sea route falls to zero. B. The increased rents to maple syrup will reduce demand for maple syrup. C. Rents for using the land route will increase, making syrup smugglers on net better off. D. Rents for using the land route will increase, but syrup smugglers on net will likely not be better off.
(Consider This) Government passes a law requiring all domestic clothing factories to pay workers at least $20 per hour. As a result, domestic clothing companies move their operations overseas, leaving domestic workers unemployed. This situation
illustrates the problem of: A. political corruption. B. unintended consequences. C. misdirection of stabilization policy. D. principal-agent.
In less-developed countries, the ________ effect leads to ________.
A. input-substitution; labor intensive production B. input-substitution; mechanized production C. output effect; labor intensive production D. input effect; mechanized production