When a firm ignores the opportunity cost of capital when making investment or shutdown decisions, this is a case of
a. Fixed-cost fallacy
b. Sunk-cost fallacy
c. Hidden-cost fallacy
d. None of the above
c
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Suppose that the equilibrium price and quantity of new houses both increase. Which of the following could be a cause of this change?
A) The wage paid carpenters who build new houses might have risen. B) A technological advance in framing a new house might have occurred. C) The rent for nearby apartments might have fallen. D) More home buyers might have moved into the area. E) The cost of wood framing used to build houses might have fallen.
Refer to Figure 2-14. Which country has a comparative advantage in the production of popsicles?
A) Greenland B) They have equal productive abilities. C) Iceland D) neither country
Which of the following are risks for multinational corporations but not risks for domestic corporations?
A) changes in government rules and regulations B) capital controls C) changes in tax laws D) government red tape and corruption
Which of the following is NOT a determinant of the price elasticity of demand?
A. the number of substitutes available to buyers B. the number of producers of the good C. the time consumers have to adjust to a price change D. expenditures on the item as a percentage of a consumer's total budget