Max has allocated $100 toward meats for his barbecue. His budget line and an indifference map are shown in the above figure. What happens if Max's mother gives him 10 pounds of burger?
A) Max would have preferred receiving the dollar value of the burger.
B) Max is indifferent between this gift and the dollar value of the burger.
C) Max prefers this gift to the dollar value of the burger.
D) None of the above.
B
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Refer to Figure 9.1. If the market is in equilibrium, total producer surplus is
A) $30. B) $70. C) $400. D) $800. E) $1200.
Opportunity cost is best defined as
A) the sum of the dollar values of all alternatives given up when choices are made. B) the cost of producing the purchased goods. C) the next highest valued alternative when a choice is made. D) the dollar price of the purchased item.
Which of the following are factors that will modify the size of the deposit expansion multiplier?
A. A foreign trade imbalance B. Cash C. Excess reserves D. Change in reserve requirements of all these factors
The invisible hand refers to
A. The person who has the responsibility to coordinate all the markets in a market economy. B. Intervention in the economy by the government bureaucrats we do not see and over whom we have no control. C. The allocation of resources by market forces. D. Undiscovered natural resources.