The assumption that individuals will not intentionally make decisions that will leave them worse off is known as
A) microeconomic analysis.
B) macroeconomic analysis.
C) a model or theory.
D) the rationality assumption.
D
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Except for the case of Giffen goods, the substitution effect always tells us that a consumer will consume less (or at least no more) of a good whose price has increased.
Answer the following statement true (T) or false (F)
The cross-price elasticity of demand between an unlimited texting option and an unlimited call minutes option offered from a cell phone provider would be
A) negative no matter if subscribers consider the services substitutes or complements for each other. B) positive if subscribers consider the services substitutes for each other. C) negative if subscribers consider the services substitutes for each other. D) positive if subscribers consider the services complements to each other.
If the economy produces 12 capital goods and 40 consumer goods,
Hypothetical Production Schedule for a Two-Product Economy
A. it is producing outside its production possibilities curve.
B. this combination of output will most likely result in economic growth.
C. the ability to produce more consumer goods can only be realized by sacrificing capital goods.
D. this economy has some unemployed resources.
If the (steadily decreasing) marginal benefit of another day spent in the hospital is equal to the (steadily increasing) marginal cost of an additional day spent in the hospital, the
A. net benefit from the hospital stay is maximized. B. net benefit from the hospital stay must be negative. C. net benefit from the hospital stay must be positive. D. net benefit from the hospital stay must be increasing.