Suppose product X is an input in the production of product Y. Product Y in turn is a substitute for product Z. An increase in the price of X can be expected to:
A. decrease the demand for Z.
B. increase the demand for Z.
C. have no effect on the demand for Z.
D. decrease the supply of Z.
Answer: B
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Marginal utility can be
A. positive, but not negative. B. positive, negative, or equal to zero. C. decreasing, but not negative. D. positive or negative, but not equal to zero.
When a seller knows more about the condition of a used car than the buyer does, the information is said to be asymmetric
a. True b. False
The U.S. capital market raises investment finance mainly through
a. Bank loan syndication b. Commercial bank lending c. Related party transactions d. Selling of new shares of stocks and bonds in equity markets e. None of the above
Explain the difference between self-interest and selfishness.
What will be an ideal response?