Which of the following is an an example of a sunk cost?
A. Jossie purchases a textbook online but returns it because it is the wrong edition.
B. Maria goes to a lunch vending machine to get a quick snack. In her haste, she mistakenly pushes the wrong buttons and gets a wheatgrass sandwich instead of hot pocket she was craving.
C. Kenny's new smartphone stops working, but it is still under warranty, so he is able to have it repaired at no cost.
D. Antonio goes to the movies. After the opening credits, he realizes he is in the wrong theater. He informs the manager and is able to get a refund.
Answer: B. Maria goes to a lunch vending machine to get a quick snack. In her haste, she mistakenly pushes the wrong buttons and gets a wheatgrass sandwich instead of hot pocket she was craving.
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Increasing productivity in a society
a. always results in a better quality of life as society views it. b. can never make a nation poorer. c. guarantees that personal services will cost less. d. makes improved personal services available to everyone.
Suppose banks decide to hold fewer excess reserves relative to deposits. Other things the same, this action will cause the
a. money supply to fall. To reduce the impact of this the Fed could sell Treasury bonds. b. money supply to fall. To reduce the impact of this the Fed could buy Treasury bonds. c. money supply to rise. To reduce the impact of this the Fed could sell Treasury bonds. d. money supply to rise. To reduce the impact of this the Fed could buy Treasury bonds.
Economic models suggest that movie stars have salaries that
a. can only be explained by looking at specific movie stars and their individual salaries. b. are about equal to their marginal revenue products. c. understate their full contribution to the movie studio's revenue-as the celebrities are the main reason that people go to see movies. d. greatly exceed their marginal contribution to the movie studio's revenue.
The long-run marginal cost (LMC) is the increase in the cost incurred by the firm when producing one additional unit of output, holding:
A. neither the workforce nor the production facility constant. B. the workforce and the production facility constant. C. the workforce constant. D. the production facility constant.