Steve is finding it impossible to get over his most recent break-up and finds himself talking about her constantly. An example of a commitment device that Steve could use to get over her would be:
A. to start dating someone else.
B. to allow Steve's best friend to punch him in the arm any time he mentions her name.
C. to take a cold shower every morning.
D. None of these is a commitment device.
Answer: B
You might also like to view...
Safe Bank has an outside display which has the time and temperature that is always correct. This is an example of
A) an interference in the workings of the price system. B) a breakdown in communication between the bank and its customers. C) a negative externality. D) a positive externality.
Which of the following most accurately states the economic significance of voluntary exchange? Select one:
a. Goods and services have value because they exist; exchange causes some people to win while others lose. b. Exchange creates value by permitting trading partners to expand total output as the result of specialization and division of labor. c. Exchange moves goods and services from people who value them more to parties who value the goods less. d. Exchange can not create additional value because no new goods or services are produced
The problem caused when people are often reluctant to voluntarily pay for goods and services that provide benefits for everyone, even for those who don't pay is called the:
A. free-rider problem. B. moral hazard problem. C. drop in the bucket hypothesis. D. rational ignorance problem.
Assume the United States and Canada have the same amount of resources. In a given time period, the United States can produce 3 tons of steel or 300 tons of wheat. Canada can produce 4 tons of steel or 400 tons of wheat. This means that
A. The United States has a comparative advantage in steel. B. Canada has an absolute advantage in both steel and wheat. C. Canada has a comparative advantage in steel. D. The United States has an absolute advantage in steel.