Which of the following is an assumption that economists make?
A. People are very good at assessing the costs of decisions accurately.
B. Individuals and firms will act to provide the things people want.
C. Most people possess entrepreneurial talent.
D. Individuals usually fail to optimize the use of their resources because they think on the margin.
Answer: B
You might also like to view...
The outcome of a prisoners' dilemma game with a Nash equilibrium is that ________
A) both players deny B) one player denies and one player confesses C) both players confess D) there is no equilibrium
The first example of comparative advantage appeared in a book that was published in 1817. This example showed that mutually beneficial trade between two countries (England and Portugal) was possible
The example assumed that two goods (wine and cloth) could be produced by both countries. Which of the following describes the conclusion of this example? A) England had an absolute advantage in both wine and cloth, but a comparative advantage in wine. B) Portugal had a comparative advantage in both wine and cloth, but its advantage in cloth was greater. C) Portugal had a comparative advantage in wine and England had a comparative advantage in cloth. D) England had a comparative advantage in both wine and cloth, but its advantage in cloth was greater.
Which of the following statements is true for a normal good?
(a) An increase in income will result in an increase in supply, ceteris paribus. (b) An increase in income will result in an increase in demand, ceteris paribus. (c) An increase in income will result in an decrease in demand, ceteris paribus (d) An increase in income will have no effect on demand, ceteris paribus.
For policymakers, the problem with a recessionary gap is ________ and the problem with an expansionary gap is ________.
A. a tendency for inflation to increase; wasted resources B. an increase in cyclical unemployment; an increase in structural unemployment C. wasted resources; a tendency for inflation to increase D. an increase in structural unemployment; an increase in cyclical unemployment