When income falls
A. there is a movement downward along the demand curve for an inferior good.
B. the demand for an inferior goods rises.
C. the demand for a normal goods rises.
D. there is a movement downward along the demand curve for a normal good.
Answer: B
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Why is a sunk cost not part of the opportunity cost of a decision?
A. Because the expense would too often outweigh the benefits. B. Because the chances of recouping it are infinitesimally small. C. Because the money is gone, regardless of the decision made. D. Sunk costs are a part of the opportunity cost of a decision.
One inconvenience of commodity money is the need for
a. money to be divisible. b. uniform quality. c. portability. d. All of the above are correct.
For this question, assume that the Marshall-Lerner condition does not hold. A reduction in the real exchange rate will tend to cause which of the following to occur?
A) a reduction in NX and a reduction in foreign output (Y) B) a reduction in NX and an increase in domestic output (Y) C) an increase in NX and a reduction in Y D) an increase in NX and an increase in Y E) none of the above
Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4According to Figure 2.4, Point A necessarily represents
A. only hybrid cars being produced. B. an unattainable production point. C. what society wants. D. the economy's optimal production point.