The opportunity cost of a decision is the value of the best foregone alternative to the decision-maker
a. True
b. False
Indicate whether the statement is true or false
True
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John is trying to decide whether to expand his business or not. If he continues his business as it is, with no expansion, there is a 50 percent chance he will earn $100,000 and a 50 percent chance he will earn $300,000. If he does expand, there is a 30 percent chance he will earn $100,000, a 30 percent chance he will earn $300,000 and a 40 percent chance he will earn $500,000. It will cost him $150,000 to expand. If John decides to expand based on expected value, it means that:
A. the sum of expected earnings from expanding and from not must exceed $150,000. B. his expected earnings from expansion must exceed $150,000. C. the difference in expected earnings from expanding versus not must exceed $150,000. D. the difference in expected earnings from expanding versus not must not exceed $150,000.
If the MPC is 0.8, and the government spends an additional $100b, the overall effect on GDP will be:
A. $400b. B. $180b. C. $500b. D. $120b.
A(n) ________ is literally a go-between, who tries to speed up the process of negotiations, but does not have the power to impose a settlement.
A. arbitrator B. mediator C. None of the choices are correct.
The profit earned by an industry is likely to be low if the
A. degree of rivalry among industries is low. B. industry has only a few large customers. C. product produced in the industry has only a few substitutes. D. industry has many customers.