Which of the following statements applies to economics, as well as to other sciences such as physics?
a. Experiments are considered valid only when they are conducted in a laboratory.
b. Good theories do not need to be tested.
c. Real-world observations often lead to theories.
d. Economics, as well as other sciences, is concerned primarily with abstract concepts.
c
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Skis and snowboards are close substitute goods. A ________ in the price of snowboards would tend to ________ the demand for ________
A) rise; increase; snowboards B) rise; decrease; snowboards C) rise; decrease; skis D) rise; increase; skis E) fall; increase; snowboards
In the short run, a firm that incurs losses might choose to produce rather than shut down if the amount of its revenue is less than its fixed cost
Indicate whether the statement is true or false
Because the income tax structure is progressive, the amount of taxes paid is a _____
a. constant fraction of income throughout the business cycle b. larger fraction of income in expansions than in contractions c. smaller fraction of income in expansions than in contractions d. decreasing function of income in both expansions and contractions e. constant amount at all levels of output and income
This prisoner's dilemma game shows the payoffs associated with two firms, A and B, in an oligopoly and their choices to either collude with one another or not.
According to the matrix shown, the outcome of the "game" will be:
A. both firms will collude and act like a joint monopolist. B. Firm B will compete and Firm A will collude. C. Firm A will compete and Firm B will collude. D. both firms will compete.