Suppose Mario is given a monthly income of $400 to spend on food while at college. Further, suppose the price of a frozen meal is $8 and the price of a cup of soup is $4. Which one of the following consumption combinations is possible given these prices and income?
A. 40 frozen meals, 50 cups of soup
B. 15 frozen meals, 80 cups of soup
C. 20 frozen meals, 60 cups of soup
D. 10 frozen meals 100 cups of soup
Answer: C
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Explain why insurance has been beneficial to markets
What will be an ideal response?
Samantha has been working for a law firm and earning an annual salary of $90,000 . She decides to open her own practice. Her annual expenses will include $15,000 for office rent, $3,000 for equipment rental, $1,000 for supplies, $1,200 for utilities, and a $35,000 salary for a secretary/bookkeeper. Samantha will cover her start-up expenses by cashing in a $20,000 certificate of deposit on which
she was earning annual interest of $1,000 . Assuming that there are no additional expenses, Samantha's total annual cost of production will equal a. $55,200 b. $221,400 c. $91,000 d. $146,200 e. $145,200
When private firms reduce investment because of the increase in interest rates brought about by government borrowing it is termed:
A. rent seeking. B. logrolling. C. crowding out. D. monetary policy.
What are the potential problems that can result if central bankers set a target of a zero rate of inflation?
What will be an ideal response?