A consumer is likely to ________ his opportunity costs when ________.
A. overvalue; they are right in front of him
B. undervalue; they are obvious
C. undervalue; they are not right in front of him
D. overvalue; they are not obvious
Answer: C
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Some authors claim that any point not on the frontier cannot be best. What is their reasoning to support this?
a. A point inside the frontier implies that society is not facing up to the problem of scarcity. b. A point inside the frontier limits growth, and growth is always a goal worth pursuing. c. A point inside the frontier represents inflation, and inflation is a dangerous situation. d. A point inside the frontier results in fewer goods, and more is always better. e. A point inside the frontier is inefficient, and represents wasted resources.
Which of the following categories accounts for about one-third of the total spending of state and local governments?
a. Community development b. Health and sanitization c. Education d. Transportation
The simple quantity theory of money predicts that an increase in M of 5 percent will lead to
A) an increase in P of 5 percent. B) an increase in P of less than 5 percent. C) an increase in P of more than 5 percent. D) a decrease in P of 5 percent. E) a decrease in P of more than 5 percent.
The intended use of TARP funds was to
A. support the FDIC. B. increase consumers’ disposable income. C. fund “shovel-ready” projects. D. purchase unwanted securities.