Institutions that encourage productive activities and discourage counterproductive ones, will tend to promote
a. economic growth.
b. rent-seeking
c. economic fluctuations
d. high rates of unemployment.
A
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Which of the following best represents collectivization costs?
A) Dinesh has to spend time and effort to make sure that the chemical factory is living up to the agreed upon bargain that it will reduce the pollution it is releasing into the local river by 50 percent. B) Laila needs to come up with enough cash to pay the owners of the paper manufacturing plant, its attorneys, accountants, and negotiators so that a bargain can be reached with the paper manufacturer to reduce air pollution. C) Esperanza has to spend time and effort locating and organizing all the other people who have been adversely affected by the strong odors emanating from the local slaughterhouse in order to initiate the bargaining process. D) Rafael has to spend time determining whether the fertilizer manufacturer, the lead smelter, or the oil refinery is the cause of pollution seeping into the groundwater in his local community.
The above figure shows Bob's utility function. He currently has $50 and is considering investing all of it in an investment that has a 50% chance of being worth $100 and a 50% chance of being worth $0. Bob will
A) definitely make the investment because the expected utility of the investment exceeds the utility of his $50. B) definitely not make the investment because the expected utility of the investment is less than the utility of his $50. C) definitely make the investment because he is indifferent between having $50 and having an investment with an expected value of $50. D) definitely not make the investment because he is indifferent between having $50 and having an investment with an expected value of $50.
The situation in which the marginal product of labor is greater than zero and declining as more labor is hired is called the law of:
a. negative response. b. inverse return to labor. c. diminishing returns. d. demand.
If the dollar were to increase relative to the currencies of our major trading partners, our trade deficit would tend to ______________.
Fill in the blank(s) with the appropriate word(s).