When there is a technological advance in the ice cream industry, consumer surplus in that market will
a. increase.
b. decrease.
c. not change, since technology affects producers and not consumers.
d. not change, since consumers' willingness to pay is unaffected by the technological advance.
Answer: a. increase.
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The empirical data reveals the velocity of M2 to be:
A. relatively stable in the long run. B. higher than the velocity of M1. C. stable only when measured annually. D. highly volatile in the long run.
If P were 7 and Q were 1,200, how much would MV be?
What will be an ideal response?
Contrast a fixed-rate exchange rate system and a flexible-rate exchange system in terms of a foreign currency shortage precipitated by an increase in U.S. demand for a foreign good.
What will be an ideal response?
Jason spends all afternoon baking a cake. When it comes out of the oven, it's burnt and sunken in the middle, and Jason considers whether he should throw it away or not. If Jason were rational, he would compare the ________, which is ________, to the benefits of eating a burnt, sunken cake.
A. benefit of throwing the cake away; the value of not having to eat burnt cake B. sunk cost; the time and ingredients spent making the cake C. opportunity cost; the value of the time spent and utility from eating or doing something else D. total cost; the value of the time spent making the cake, the cost of ingredients, and value of the time that could be spent doing something other than eating the cake