Player 1 and Player 2 are playing a game in which Player 1 has the first move at A in the decision tree shown below. Once Player 1 has chosen either Up or Down, Player 2, who can see what Player 1 has chosen, must choose Up or Down at B or C. Both players know the payoffs at the end of each branch. 
What is the equilibrium outcome of this game?
A. Player 1 chooses Down and Player 2 chooses Up.
B. Player 1 and Player 2 both choose Down.
C. Player 1 chooses Up and Player 2 chooses Down.
D. Player 1 and Player 2 both choose Up.
Answer: C
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If net foreign investment in the United States is positive, how must national saving and domestic investment be related? (Assume that the capital account is zero and net transfers are zero.)
A) Domestic investment can be greater than or less than national saving. B) Domestic investment must be greater than national saving. C) Domestic investment must be less than national saving. D) Domestic investment and national saving must also be positive.
Demand-pull inflation occurs:
a. at or close to full employment. b. because of excess total spending. c. when "too much money is chasing too few goods." d. all of these.
Basic supply and demand analysis can be used to explain how externalities lead to environmental problems.
Answer the following statement true (T) or false (F)
The main objective of a business in a market economy is
A. controlling costs. B. maximizing the production function. C. profit maximization. D. decreasing revenue.