Despite the warning on a package of cigarettes about the potential health hazards of smoking, a man lights up a cigarette. An economist would conclude that:
a. in the man's judgment, the expected marginal cost of smoking the cigarette outweighs the expected marginal benefit.
b. the man is behaving irrationally
c. the smoker is unconcerned about his future health.
d. in the man's judgment, the expected marginal benefit of smoking the cigarette outweighs the expected marginal cost.
d
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In the above figure, the equilibrium price of a paperback book is $6 per book and the equilibrium quantity is 3 million books. The National Literature Board convinces the government to impose a price ceiling of $3 per book
At this price, the quantity of books supplied to the market will be A) 3 million a month and will equal the quantity demanded. B) less than 3 million a month and will exceed the quantity demanded. C) less than 3 million a month and will be less than the quantity demanded. D) more than 3 million a month and will exceed the quantity demanded.
For a bank, the ration of after-tax profit to assets is its:
A) net interest margin. B) return on assets. C) return on equity. D) spread.
Net exports
a. are equal to total exports minus total imports b. are always positive because total imports exceed total exports c. are always negative because total exports exceed total imports d. always exceed total exports e. include goods produced and sold abroad
Figure 10-4
In Figure 10-4, if full employment occurs at an output level of 4,000 and the economy is currently at an output level of 5,000 then we can expect a(n)
a.
increase in autonomous consumer spending that shifts the aggregate demand curve to the left.
b.
increase in wages that will shift the aggregate supply curve to the left.
c.
decrease in investment spending that shifts the aggregate demand curve to the left.
d.
decrease in wages that will shift the aggregate supply curve to the left.