Which of the following represents a consumer's optimum?
a. MUx/MUy = Py/Px
b. MUx/Py = MUy/Px
c. MUx/Px = MUy/Py
d. MUy/MUx = Px/Py
c
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Strictly speaking, which entity below makes decisions?
A) The House B) The Senate C) Congress D) All of the above. E) None of the above.
Behavioral economists examine choices that consumers make that are not economically rational
Economists generally assume that people are rational; that is, they weigh the benefits and costs of an action and choose an action only if the benefits outweigh the costs. Why do consumers not act rationally when the result is that they make themselves worse off?
The benefits principle is often used to justify
a. the progressive income tax. b. a flat income tax. c. a regressive excise tax. d. earmarking the proceeds from taxes for specific public services.
If the measured unemployment rate is 8% and the natural unemployment rate is 3%, then
A. frictional unemployment is 5%. B. structural unemployment is 11%. C. frictional unemployment is 11%. D. cyclical unemployment is 5%.