To be useful, a model must
A) predict accurately all of the time.
B) predict more accurately than other models that have been developed.
C) have assumptions that have been verified by empirical testing.
D) predict the behavior of every individual.
Answer: B
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Opportunity cost
A) can only be measured as a paid cost. B) is always the value of the next best forgone opportunity. C) does not exist since there are no receipts. D) is always the lowest valued alternative.
Which of these factors can explain the short recession experienced by the U.S. in 2001?
a. Terrorist attacks b. The stock market crash c. Bursting of the real estate bubble d. A rise in international oil prices e. Expenditure on war
In the field of study called political economy, economists make use of insights from the field of psychology
a. True b. False Indicate whether the statement is true or false
A tax on primary resource use would
a. Increase recycling rates and raise the costs of some products b. Increase recycling rates and not affect product costs c. Decrease recycling rates and raise the cost of some products d. Decrease recycling rates and not affect product costs e. Decrease recycling rates but the effect on prices is unknown