A person cutting up her credit cards in an effort to curb her spending is an example of:
A. a commitment device.
B. status quo bias.
C. loss aversion.
D. the endowment effect.
Answer: A
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Starting from long-run equilibrium, a decrease in autonomous investment results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; higher C. higher; potential D. lower; higher
Barbara, the consummate hostess, proudly announced as she served dessert, "A port is often the perfect end to a meal, sipped with a piece of my scrumptious chocolate cake." Evidently, Barbara views port and chocolate cake as
A) luxury items. B) complementary goods. C) necessities. D) substitutes for other desserts.
Refer to Table 9-12. If the actual terms of trade are 1 belt for 1.5 swords and 50 belts are traded, how many swords will Estonia consume?
A) 75 B) 100 C) 125 D) 200
A change in regulations increases the size of the airplanes that can fly into a local regional airport. The increase in average plane size increases noise pollution considerably
If compensation is to be paid to those harmed by this externality, the most efficient form of compensation would be _____. a. a lump sum payment b. a payment per violation c. a set payment every month d. regular payments equal to the monthly cost imposed on homeowners