You are a hotel manager and you are considering four projects that yield different payoffs, depending upon whether there is an economic boom or a recession. The potential payoffs and corresponding payoffs are summarized in the following table.ProjectBoom (50%)Recession (50%)A$20-$10B-$10$20C$30-$30D$50$50The expected value of project D is:
A. $10.
B. $20.
C. $5.
D. None of the answers are correct.
Answer: D
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Monetary costs and opportunity costs are always identical.
Answer the following statement true (T) or false (F)
Say's Law is the claim that the aggregate value of goods and services produced necessarily:
A. increases over time. B. will decrease over time. C. creates a smaller value of aggregate demand for those goods. D. creates an equal value of aggregate demand for those goods.
Which of the following is considered a microeconomic topic?
A. The review of quarterly national income accounting data B. A firm’s decision to purchase pay-per-click online advertising C. The Federal Reserve decides to increase the discount rate D. The CPI reports a rise in inflation during July
When an economy is operating at full employment, _____
a. structural unemployment does not exist b. cyclical unemployment does not exist c. the unemployment rate is zero d. seasonal unemployment does not exist e. the number of discouraged workers is zero