Keith just got an iPhone 5 for his birthday, and he quickly switches his data over and throws his iPhone 4 in a drawer and forgets about it. Economists would say this behavior is ________ and would use the concept of ________ to explain this choice.
A. irrational; the implicit cost of ownership
B. irrational; ignoring sunk costs
C. rational; considering sunk costs
D. rational; the implicit cost of ownership
Answer: A
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Answer the next question using the following budget information for a hypothetical economy. Assume that all budget surpluses are used to pay down the public debt. Government SpendingTax RevenuesGDPYear 1$450$425$2,000Year 25004503,000Year 36005004,000Year 46406205,000Year 56805804,800Year 66006205,000 If year 1 is the first year of this nation's existence and year 6 is the present year, this nation's public debt is
A. $275 billion. B. $3,540 billion. C. $100 billion. D. $230 billion.
Which of the following does NOT increase the supply of personal computers, that is, does NOT shift the supply curve of personal computers?
A) a fall in the cost of the components used to assemble personal computers B) a change in the expected future price of a personal computer C) an advance in the technology used to produce personal computers D) an increase in the number of firms producing personal computer E) a rise the price of a personal computer
Prior to 1840, most businesses were
A) family-owned. B) corporate in structure. C) vertically integrated. D) collections of partnerships.
Which of the following groups is most hurt by unanticipated inflation?
A. Workers with cost of living adjustment clauses in their labor contracts. B. Social Security recipients. C. Workers who sign new work agreements every day. D. Wealthy people who hold much cash in their wall safes.