When the price of gasoline rises, some consumers begin riding their bikes more frequently or riding the bus instead of driving their cars. The fact that the CPI does not fully account for such changes in consumer behavior is called
A) outlet bias.
B) increase in quality bias.
C) substitution bias.
D) discrimination bias.
Answer: C
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A decrease in foreign income ________ exports of U.S.-made goods, so aggregate demand ________ and the aggregate demand curve shifts ________
A) increases; increases; rightward B) decreases; decreases; leftward C) decreases; increases; rightward D) increases; increases; leftward E) decreases; decreases; rightward
Strategic trade policy considerations imply that free trade policies should never be pursued
Indicate whether the statement is true or false
In a particular country in 1999, the average worker had to work 20 hours to produce 55 units of output. In that same country in 2009, the average worker needed to work 28 hours to produce 77 units of output. In that country, the productivity of the average worker
a. increased by 2 percent between 1999 and 2009. b. increased by 5 percent between 1999 and 2009. c. remained unchanged between 1999 and 2009. d. decreased by 3 percent between 1999 and 2009.
Suppose a monopolist faces the demand curve shown below. 
If the monopolist's marginal cost is constant and equal to $30, its profit-maximizing level of output is:
A. 50 units. B. 30 units. C. 40 units. D. 20 units.