Marketers have no incentive to introduce products that are not designed to sell.
Answer the following statement true (T) or false (F)
False
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You want to buy a TV that regularly costs $250. You can either buy the TV from a nearby store or from a store that's downtown. Relative to going to the nearby store, driving downtown involves additional time and gas. The downtown store, however, has a 10% off sale this week. Last week you drove downtown to save $20 on some concert tickets, a 15% savings. Should you drive downtown to buy the TV?
A. Yes, because you will save more than $20. B. Yes, because you will save 10%, which is better than nothing. C. No, because you will only save 10%, which is less than 15%. D. No, because you will save more than $20.
In which of these situations would the Coase theorem be MOST likely to work?
A) A thousand firms use a lake, there are no other users, all their costs could be reduced somewhat by polluting, but all would have lower water intake costs if the lake were clean. B) A group of nine firms use a lake, there are no other users, all their costs could be reduced somewhat by polluting, but all would have lower water intake costs if the lake were clean. C) Worldwide deep sea fishing rights need to be negotiated among thousands of fishermen from different countries. D) One hundred and fifty nations need to come to an accord about CFC generation to combat ozone depletion. E) A group of chemical firms high upstream on the Mississippi River have emissions that affect not only communities downstream along the river, but around the Gulf of Mexico as well.
Explain how the current U.S. tax system levies taxes on capital gains and earned interest. What does this mean for the costs of inflation?
The rational expectations hypothesis is based on all the following assumptions EXCEPT
A. use of knowledge of effects of past policy actions. B. understanding of how the economy operates. C. understanding that prices are sticky. D. use of judgment about effects of future policy actions.