Hannah and Chris each like jewelry and music by the Rolling Stones. If we were to graph an indifference curve with jewelry on the horizontal axis and CDs by the Rolling Stones on the vertical axis, then
a. Hannah and Chris would have identical indifference curves.
b. Hannah's indifference curve would be higher than Chris's indifference curve.
c. Chris's indifference curve would be higher than Hannah's indifference curve.
d. Because we do not know the intensity of each woman's preferences, we do not have enough information to compare their indifference curves.
d
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What happens to overall living standards when countries trade with other countries?
What will be an ideal response?
A payment for the use of an input that exceeds the opportunity cost of the input is known as
A) real interest. B) economic profit. C) economic rent. D) economic cost.
As we approached the end of the millennium, many economic crackpots advised citizens to hold large quantities of cash in anticipation of Y2K disasters. What effect would this have had on velocity if many people had been foolish enough to follow this advice?
a. It would have decreased. b. It would have increased. c. It would have remained constant. d. Velocity is unrelated to cash balances.
Refer to the accompanying figure. Suppose the solid line represents the current supply of Star Wars action figures. If retailers learn that a new Star Wars movie will be released in several months, this news is likely to cause:
A. a decrease in the quantity supplied, but no change in current supply. B. current supply to shift to S(B) in anticipation of higher future prices. C. neither a change in supply nor a change in quantity supplied since only future demand will change. D. current supply to shift to S(A) in anticipation of higher future prices.