The opportunity cost of doing an activity is;
(a) Measured in terms of utils.
(b) Measured in terms of the value of the next best alternative that has been given up.
(c) Measured in terms of the value of everything else that has been given up.
(d) Both (a) and (c) are correct.
Answer: (b) Measured in terms of the value of the next best alternative that has been given up.
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In the figure above, if the exchange rate is equal to 2 Canadian dollars per U.S. dollar, there is a ________ of ________currency and the exchange rate will________
A) surplus; domestic; fall B) surplus; foreign; fall C) surplus; domestic; rise D) shortage; domestic; fall
Devoting more of a country's resources for producing consumer goods means
a. economy is using it resources for future production. b. fewer resources to producing investment goods. c. country will grow more rapidly in the future. d. productivity of the invested capital is extremely high.
Given that the median male is better paid than the median female, which of the following is a valid explanation for wage differences?
a. compensating differentials b. differences in human capital c. discrimination d. All of the above can be a partial explanation.
Lawrence’s country has had three different governments in the last two years. Lawrence knows several people who had their property seized without payment when the new government took over. People are no longer starting businesses or buying buildings because they have no way to guarantee that they will still own them tomorrow. What is the likely result of the situation in Lawrence’s country?
a. The incentive to invest is high. b. The private sector will step in to increase growth. c. The country will have a low rate of economic growth. d. The country will have a high rate of output per capita.