The permanent-income hypothesis was developed in the 1950s by economist
A) Edward Prescott.
B) James Tobin.
C) Robert Solow.
D) Milton Friedman.
D
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The De Beers Company, one of the longest-lived monopolies, is facing increasing competition. One source of competition comes from people who might resell their previously owned diamonds
Why is De Beers worried that people might resell their previously owned diamonds? A) because the availability of previously owned diamonds would make the market demand curve for diamonds more inelastic and force De Beers to lower its price B) because previously owned diamonds would be a close substitute to newly mined diamonds and therefore reduce De Beers' market power C) because the availability of previously owned diamonds would increase the market demand for diamonds and dilute De Beers' monopoly D) because De Beers will not be able to guarantee the quality of previously owned diamonds and fears that its reputation might be harmed
Our business cycle experiences suggest that a macroeconomic policy designed to lower the average rate of inflation will require ________ in actual real GDP and an accompanying ________ in the unemployment rate
A) an increase, increase B) an increase, decrease C) a reduction, increase D) a reduction, decrease
Mary has opened a preschool, which involves paying rent on the building, playground improvements, and teacher salaries. She spreads the word through advertising and social media to attract families. During the first year, Mary takes no salary while the school is getting off the ground. Which of these constitutes implicit costs for the preschool business?
a. Attracting families through social media is free, so it is an implicit rather than explicit cost. b. Paying rent is an implicit cost because starting a preschool implies needing a physical location. c. Teacher salaries are an implicit cost because a school must have teachers. d. Forgoing a year’s salary is an implicit cost because it represents a resource contributed by the owner.
Why is it NOT surprising that men make up the minority of college graduates?
a. Because of discrimination against women, men are able to get good jobs with only a high school degree. b. Men are smarter than women and they do not need a higher education to be attractive to employers. c. Given their greater physical strength, many men accept high-paying but physically demanding jobs instead of going to college. d. Many men decide to pursue jobs in professional sports and this significantly reduces the number of males who go to college.