Which of the following questions best illustrates the "framing effects" studied by behavioral economists?
A. Which would you rather have after lunch today: an apple or an orange?
B. How much would you rather receive: $100 while everyone else gets $110, or $80 like everyone else?
C. Where would you rather invest your funds in: stocks or gold certificates?
D. What would you rather do: go to college and postpone having a full-time job, or forgo college and get a full-time job now?
B. How much would you rather receive: $100 while everyone else gets $110, or $80 like everyone else?
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Answer the following statement(s) true (T) or false (F)
1. Incremental costs are the accumulated expenditures associated with an environmental policy initiative. 2. When implementing environmental policy, all expenses paid by the government plus compliance costs paid by all economic sectors are known as explicit costs. 3. Fixed costs are controllable in the short run but not the long run. 4. The accounting equivalent of variable costs is capital costs. 5. The value of reduced product variety due to an environmental policy initiative or regulation is an example of an implicit cost.
If the government desires to raise a certain amount of revenue by taxing a monopoly, an ad valorem tax will
A) generate the same loss of consumer surplus as a specific tax. B) generate a greater loss of consumer surplus than a specific tax. C) generate a smaller loss of consumer surplus than a specific tax. D) generate no loss of consumer surplus.
The income effect refers to the impact of a change in
a. income on the price of a good b. the general price level caused by a change in the price of another good c. the price of a good on real income d. the price of a substitute for the good under consideration e. demand when income changes
Look at the following data: The frictional unemployment rate is 2 percent, the structural unemployment rate is 3.5 percent, and the actual unemployment rate is 9.5 percent. The natural unemployment rate is ____________ percent and the cyclical unemployment rate is __________ percent
A) 1.5; 4 B) 5.5; 4 C) 1.5; 6 D) 6; 15