Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4According to Figure 2.4, as the economy moves from Point E to Point A, the opportunity cost of hybrid cars, measured in terms of motorcycles
A. increases.
B. initially increases, then decreases.
C. decreases.
D. remains constant.
Answer: A
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What is the difference between economic profit and normal profit?
What will be an ideal response?
Human capital increases with on-the-job training.
Answer the following statement true (T) or false (F)
Normal goods always obey the law of demand because, as the price of such a good rises, the
a. fall in quantity demanded due to the substitution effect is offset by a rise in quantity demanded due to the income effect b. fall in quantity demanded due to the substitution effect is reinforced by a fall in quantity demanded due to the income effect c. substitution effect will lead to an inward shift of the demand curve d. substitution effect will lead to an increase in quantity demanded e. rise in quantity demanded due to the substitution effect is offset by a fall in quantity demanded due to the income effect