Suppose you pre-ordered a non-refundable movie ticket to Avengers: Infinity War. On the day of the movie you decide that you would rather not go to the movie. According to economists, what is the rational thing to do?
A) Since you do not want to go to the movie and the cost of the movie ticket is a sunk cost, how much you paid for the ticket should not influence your decision.
B) You should not waste resources. Since you have paid for the ticket you should watch the movie.
C) Your should go to the movie to minimize your losses.
D) You should go to the movie to maximize your utility.
Answer: A
You might also like to view...
If money demand is extremely sensitive to changes in the interest rate, the money demand curve becomes almost horizontal. If the Fed expands the money supply under these circumstances, then the interest rate will
A) change very little and investment and consumer spending will change very little. B) rise substantially and investment and consumer spending will rise substantially. C) fall substantially and investment and consumer spending will fall substantially. D) fall substantially and investment and consumer spending will change very little.
The concept of poverty is culturally determined, and hence people are defined as “poor” in relation to others.
Answer the following statement true (T) or false (F)
A payment is said to be indexed if it is automatically adjusted for inflation.
Select whether the statement is true or false. A. True B. False
Refer to the information provided in Figure 3.13 below to answer the question(s) that follow.
Figure 3.13Refer to Figure 3.13. Assume hamburgers are a normal good. A decrease in income will cause a movement from
A. D2 to D1. B. Point G to Point F. C. S2 to S1. D. Point A to Point B.