According to economists, when two people make exactly the opposite decision
A) one of them is acting irrationally.
B) each person evaluates the situation according to his/her individual self-interest.
C) one of them is acting out of spite.
D) one of them should compromise.
B
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Emily is a writer. She buys pens and paper for $20 and writes a 500-page novel that she sells to a publishing company for $500,000. If the publisher prints 1 million copies that sell for $25 each, what is the contribution to GDP of Emily's novel?
A) $25 million B) $20 million C) $500,000 D) $50,000
We collapse the consumer's current-period and future-period budget constraints into a single lifetime budget constraint by
A) assuming no default. B) substituting for savings. C) eliminating consumption smoothing. D) assuming the consumer knows the future.
Refer to Figure d, which illustrates a game played by Travis and Darren. Darren's dominant strategy is:
A. East.
B. West.
C. neither East nor West because East is only weakly dominated.
D. both East and West.
Economics is a
A) hard science. B) physical science. C) natural science. D) social science.