Intertemporal choice theory is more consistent with ________
A) Keynesian theory than the permanent income hypothesis of Friedman
B) the permanent income hypothesis than Keynesian theory
C) Keynesian theory than the life-cycle hypothesis
D) Keynesian theory than the Gini coefficient theory
B
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The above figure shows the PPF for a country that produces computers and computer factories. The nation's production possibilities frontier is PPF0 . At which of the following production points would the economy grow most rapidly?
A) Point A B) Point B C) Point C D) It makes no difference among the three points because they are all production efficient. E) More information is needed to answer the question.
In Homer's Odyssey, Odysseus instructs his crew members to tie him to the mast of the ship so that he is not later tempted by the Siren's song. Which of the following irrational behaviors was he trying to avoid? a. People are overconfident
b. People behave in a time inconsistent manner. c. People give too much weight to a small number of vivid observations. d. People are reluctant to change their minds.
Consider a factory that emits chemicals into a river, thus polluting the water supply of a downstream community. The Coase Theorem states that the socially optimal, or efficient, solution can be achieved by assigning property rights to _____________________.
a. the company. b. the community. c. the company and the community, jointly. d. the company or the community. e. a government regulator.
Which of the following will increase macroeconomic equilibrium prices?
A. an increase in productivity B. an increase in taxes C. an increase in input prices D. a decrease in government spending