Suppose that some investors have decided that economic and financial uncertainty have made the prospect of investing in domestic stock markets more risky than investing in foreign stock markets, and therefore choose to invest in foreign markets
By using all available information as they act to achieve their goals, these investors are exemplifying the economic idea that
A) people are rational. B) people respond to economic incentives.
C) optimal decisions are made at the margin. D) equity is more important than efficiency.
A
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The establishment of an income tax, ceteris paribus, will result in
A) a lower expenditure multiplier. B) a higher expenditure multiplier. C) no change in the size of the multiplier. D) None of the above.
An example of price discrimination is the price charged for:
A. an economics textbook at a campus bookstore. B. gasoline. C. a piece of art sold at an auction. D. a postage stamp.
When the long-run average total cost curve is horizontal, a firm has economies of scale.
Answer the following statement true (T) or false (F)
As the dollar is devaluated
A. inflationary pressures are reduced and our standard of living is reduced. B. inflationary pressures are increased and our standard of living is increased. C. inflationary pressures are reduced and our standard of living is increased. D. inflationary pressures are increased and our standard of living is reduced.