If an economy is producing inefficiently, it is
a. possible to increase production of all goods simultaneously.
b. possible to increase production of one good at the expense of another.
c. not possible to increase production of any good.
d. not possible to increase economic growth.
e. possible to increase production with no effort.
a
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Suppose Adam Einberg pays $100 for a ticket to a new Broadway play and $100 was the maximum price he was willing to pay. On the day of the performance of the play Adam refuses to sell the ticket for $150
How would behavioral economists explain Adam's refusal to sell his ticket? A) Adam's tastes had changed from the time he bought the ticket to the time of the performance of the play. B) Adam's income probably increased between the time he bought the ticket and the day of the play's performance. C) The endowment effect explains Adam's actions. People like Adam seem to value things that they have more than the things they do not have. D) When Adam bought the ticket he was being unrealistic about his future behavior.
Which of the following models has as its central idea that workers and firms have rational expectations?
A) the new classical model B) the monetarist model C) the real business cycle model D) the new Keynesian model
In 2003, the largest component of U.S. GDP was
a. personal consumption expenditures b. government purchases c. durable goods d. net exports e. gross private domestic investment
Refer to the information provided in Figure 5.6 below to answer the question that follows.
Figure 5.6Refer to Figure 5.6. The market is initially in equilibrium at Point A and supply shifts from S1 to S2. Which of the following statements is true?
A. Price will still serve as a rationing device causing quantity supplied to exceed 12 thousand pizzas. B. The market cannot move to a new equilibrium until there is also a change in demand. C. Price will still serve as a rationing device causing quantity demanded to fall from 12 to 10 thousand pizzas. D. There is no need for price to serve as a rationing device in this case because the new equilibrium quantity exceeds the original equilibrium quantity.