The smallest component of national income is
A. rent.
B. interest.
C. profits.
D. salaries and wages.
Ans: D. salaries and wages.
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Is there any similarity between a perfectly competitive firm and a monopolistically competitive firm in the long run? Explain your answer
What will be an ideal response?
Which of the following could explain why the demand for table salt is inelastic?
A) Salt is a luxury for high-income consumers but a necessity for low-income consumers. B) Salt is a rare commodity. C) Salt is a luxury good. D) Households devote a very small portion of their income to salt purchases.
For a government to be efficient, a project should be funded up to
A. MB = 0. B. MB = ~ C. MC = 0. D. MC = ? . E. MB = MC.
On a vacation to China, you find yourself eating every meal at the local Burger King rather than buying a meal from one of the street vendors. Your traveling companion claims that you are irrational, since you never eat Burger King hamburgers when you are home, and Burger King's hamburgers cost more than the meals prepared and sold by China's street vendors. An economist would most likely explain
your behavior by suggesting that a. your behavior is rational, but your friend's behavior is clearly irrational. b. you are clearly irrational, but your friend's behavior is rational. c. the Burger King brand name suggests consistent quality. d. the advertising by Burger King in China is more persuasive than the advertising by Burger King in your home town.