Refer to the information provided in Figure 6.1 below to answer the question(s) that follow.
Figure 6.1Refer to Figure 6.1. AC represents Tom's budget constraint. Point D then represents a point that is
A. not available because it represents a combination of hamburgers and hot dogs that he cannot purchase with his income.
B. an available option, as Tom is just spending all of his income.
C. available, but at which he does not spend all his income.
D. in his opportunity set but not on his budget constraint.
Answer: A
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Ethiopia provides a counterexample to the claim
A) central economic planning doesn't work well. B) nations are poor because they are subject to exploitation by nations with superior military power. C) a nation can move to the ranks of the wealthiest in the world with few natural resources. D) the rule of law is necessary for economic growth.
If government's goal is to raise tax revenue and limit efficiency loss, taxation is most effective when:
A. supply is inelastic and demand is elastic. B. demand or supply is elastic. C. demand or supply is inelastic. D. demand is inelastic and supply is elastic.
In a voluntary exchange,
A) both parties tend to receive more in value than they give u
Refer to Figure 2-13. What is the opportunity cost of producing 1 ton of coconuts in Guatemala?
A) 1/2 of a ton of pineapples B) 1 1/3 tons of pineapples C) 2 tons of pineapples D) 90 tons of pineapples