Rob took the afternoon off from his job as a tire salesman to mow his lawn. Rob told his wife that this made sense because he would be saving the $50 he would have to pay a lawn service, noting that this would be the opportunity cost to the family. Rob’s wife disagreed. What did Rob’s wife say?
A. The opportunity cost would be Rob’s lost income from selling tires that afternoon plus the $50.
B. The opportunity cost would be Rob’s lost income from selling tires that afternoon minus the $50.
C. That Rob just wanted to take the afternoon off.
D. The opportunity cost would be Rob’s lost income from selling tires that afternoon.
Answer: B
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The multiplier effect relates changes in
A. disposable income to changes in consumption. B. the price level to changes in real GDP. C. the interest rate to changes in investment. D. spending to changes in real GDP.
A firm that is a price taker faces
A) an elastic supply curve. B) an inelastic supply curve. C) a perfectly elastic demand curve. D) a perfectly inelastic demand curve. E) an elastic but not perfectly elastic demand curve.
In the one-input model of production, increasing marginal product implies non-convexity of the producer choice set.
Answer the following statement true (T) or false (F)
Refer to Figure 18-9 to answer the following questions
a. Did the distribution of income become more equal in 2016 that it was in 2015, or did it become less equal? Explain. b. If area A = 1,600, area B = 200, and area C = 3,200, calculate the Gini coefficient for 2015 and the Gini coefficient for 2016.