Wealth can be thought of as:
A. The sum of all assets you have at any one point in time.
B. The sum of all assets and any expected future assets.
C. The sum total of all assets less any debts.
D. The income that you have earned that year.
Answer: C
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Comparative advantage is
A) the ability to perform an activity at a lower opportunity cost than anyone else. B) the ability to perform an activity at a higher opportunity cost than anyone else. C) the ability to perform an activity at a zero opportunity cost. D) another name for absolute advantage.
Which of the following is added to arrive at GDP? a. The value of "free" household services provided by at home spouses rather than a paid cook, housekeeper, and baby sitter. b. The value of unpaid volunteer time
c. The unpaid services provided by the natural environment, such as breathable air. d. Net exports.
Lower rates of inflation increase planned spending because:
A. the Fed reacts to the lower inflation by lowering interest rates. B. resources are redistributed from high-spending households to low-spending households. C. the reduction in wealth, resulting from the reduced real value of money, restrains spending. D. the prices of domestic goods sold abroad increase (with a constant exchange rate).
The cross-price demand curve for Cobb-Douglas tastes is perfectly vertical.
Answer the following statement true (T) or false (F)