Predictions of stock prices by stock market analysts
a. usually improve on simple extrapolation of past trends.
b. are good in both the short term and in the long term.
c. are poor since Wall Street does not pay enough to attract the best analysts.
d. are poor because of randomness.
d
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If you own a building and you decide to use that building to open a restaurant,
A. there are no sunk costs involved in this decision. B. there is no opportunity cost of using this building for a restaurant because you own it. C. the only cost relevant to this decision is the price you paid for the building. D. there is an opportunity cost of using this building for a restaurant because it could have been used in other ways.
The problems with using the consumer price index as a measure of the cost of living are important because
a. even the appearance of high rates of inflation cause voters to become disenchanted. b. politicians have manipulated the measurement problems to their advantage. c. many government programs use the CPI to adjust for changes in the overall level of prices. d. if the price level is overstated, consumers will be taken advantage of by sellers of consumer goods.
When Sonoma Vineyards reduces the price of its Cabernet Sauvignon from $15 a bottle to $12 a bottle, the result is an increase in
A. the supply of this wine. B. the demand for this wine. C. the quantity of this wine demanded. D. the quantity of this wine supplied.
Jane wants to buy a beautiful doll as a gift for her sister's birthday. She knows that the same product is offered in different shops with prices of $120, $100, and $80 with odds of one-third of finding each price. She just stopped at a shop and knows that the price is $100. If the search cost is $8 per time, what should she do?
A. Accept the offer in hand. B. She should toss a coin. C. Search once more and decide again upon knowing the price. D. Insufficient information to determine.