Greg spends his entire budget on two goods: he plays video games at the mall arcade and he buys pizza. He discovers that his MU/P of video games is lower than his MU/P of pizza. From this, we know that he would be
a. happier eating less pizza and playing fewer video games
b. happier eating less pizza and playing more video games
c. happier eating more pizza and playing fewer video games
d. indifferent to which selection he makes
e. less happy if he made any change because he has obviously bought the quantities that maximize his total utility
C
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The figure above shows the market for bank reserves in Futureland. If the Bank of Futureland undertakes an open market purchase of government securities that changes the quantity of reserves by $25 billion, then the federal funds rate will
A) fall to 4 percent a year. B) remain at 6 percent a year. C) rise to 8 percent a year. D) change, but more information is needed to determine by how much. E) None of the above answers is correct.
In the above table, what is the marginal revenue product of the 1st worker?
A) $92 B) $70 C) $40 D) $8
"Buy now, pay later" or "try it before you buy it" are examples of
a. Loss aversion b. Endowment effect c. Confirmation bias d. Anchoring bias
Which of the following will increase (V0), the shareholder wealth maximization model of the firm: V0•(shares outstanding) = ??t=1 (? t ) / (1+ke)t + Real Option Value
a. Decrease the required rate of return (ke). b. Decrease the stream of profits (?t). c. Decrease the number of periods from ? to 10 periods. d. Decrease the real option value. e. All of the above.