According to the rational choice model developed in the text, which statement below is false?
a. people would be less happy if they exchanged money rather than things at Christmas
b. Individual preference patterns do not change because prices change
c. consumers behave as if they did cost-benefit analysis on every purchase
d. cash grants are always better than in-kind gifts
e. none of the above
Ans: a. people would be less happy if they exchanged money rather than things at Christmas
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Currently, the dominant reserve currency is the
A) U.S. dollar. B) Japanese yen. C) euro. D) British pound.
Don's Pasture Apple Cider Company buys four inputs: apples, glass bottles, apple presses, and computers for record keeping. If the company decides to become more vertically integrated, it will
a. probably start growing apples next b. probably start making glass bottles next c. probably start making apple presses next d. probably start making computers next e. have to grow apples and make glass bottles, apple presses, and computers
When a firm operates with excess capacity, it must be in a monopolistically competitive market
a. True b. False Indicate whether the statement is true or false
The chief disadvantage of inflation targeting is that
A. it is difficult to measure the inflation rate precisely. B. it is not easy for the public to observe the inflation rate. C. it is difficult for the central bank to judge what policy actions are needed to hit the target. D. people do not understand what inflation is.