People make mistakes in allocating their time
a. only when leisure time is an inferior good
b. because expectations are not always fulfilled
c. more often when the cost of making a mistake is high
d. only when economists remove the assumption that individuals are rational
e. because information is free and readily available
B
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In the circular flow model, the expenditures on goods and services flow in the
A) same direction as goods and services in all cases. B) same direction as goods and services only if they both flow through the goods market. C) same direction as goods and services only if they both flow through the factor market. D) opposite direction as goods and services. E) same direction as factor markets.
A horizontal demand curve is perfectly elastic because a change in price will not induce a change in quantity demanded
a. True b. False Indicate whether the statement is true or false
A basic factor of production that is used to produce output is:
A. labor. B. technology. C. capital. D. All of these are considered factor inputs.
In the early 2000s, some argued that the Indian government impeded foreign investment with tariffs, investment caps, and tons of red tape. In terms of promoting or retarding economic growth, such policies:
A. increase growth because they keep people producing for the local market. B. decrease growth because they slow the growth of capital. C. increase growth because they stop exploitation by foreigners. D. decrease growth because they cause inflation.