In economics, we observe that people consistently make irrational decisions in certain situations and choose to do something even if:
A. the benefits outweigh the opportunity costs.
B. the opportunity costs outweigh the benefits.
C. the benefits outweigh the sunk costs.
D. the sunk costs outweigh the opportunity costs.
B. the opportunity costs outweigh the benefits.
You might also like to view...
Given the prices of two goods, all quantity combinations inside the budget line are:
a. indifferent. b. efficient. c. unattainable. d. attainable.
Because it is difficult to negotiate multilateral trade agreements, some economists argue that preferential trade agreements are always beneficial since they represent a movement toward freer trade, which is better than no movement at all. Is this argument always correct?
a. Yes; any movement toward freer trade is better than no movement at all. b. No; some preferential trade agreements may have higher trade diversion costs than trade creation gains. c. Yes; all preferential trade agreements have higher trade creation gains than trade diversion losses. d. No; all preferential trade agreements have higher trade diversion losses than trade creation gains.
Over the past decade technological improvements that have lowered the cost of producing an automobile have increased
A) both the supply and the demand for automobiles. B) the supply but not the demand for automobiles. C) the demand but not the supply of automobiles. D) neither the supply nor the demand for automobiles.
Each member of OPEC can increase its income by selling more oil than its output quota because
A) the demand for oil is perfectly elastic. B) by selling more at OPEC's cartel price, a member will automatically earn more income. C) each member's demand is more elastic than the total demand for oil. D) the demand for oil is inelastic so total revenue increases.