The function of money that provides for a commonly recognized measure of value for the price system is a(n)
A) medium of exchange.
B) unit of accounting.
C) store of value.
D) standard of deferred payment.
B
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If Rory McIlroy only earned $500 per hour playing golf instead of $1,000 per hour, what should he do?
A) He should be indifferent as to who does the weed-whacking, for the difference in hourly earnings would now be insignificant. B) He should hire a less-productive gardener. C) He should do the weed-whacking himself. D) He should still hire the gardener.
According to interest rate parity, if the interest rate is 1 percent in the European Union and the euro is expected to appreciate 3 percent, the comparable interest rate in the United States will be
A) 4 percent. B) 3 percent. C) 2 percent. D) 1 percent.
One problem with regulating a monopolist on the basis of cost is that
a. by focusing on costs, the regulators ignore profits. b. it does not provide an incentive for the monopolist to reduce its cost. c. a monopolist's costs, by definition, are higher than costs of perfectly competitive firms. d. a monopolist is still able to generate excessive economic profits.
The law of diminishing marginal product states that
A) output will continue to increase indefinitely if more variable factors of production are added to an existing stock of fixed factors. B) successive equal-sized increases in labor, when added to fixed factors of production, will result in smaller increases of output. C) a doubling all inputs will double output. D) variable costs tend to decrease with output.