Tracy and Amy are playing a game in which Tracy has the first move at X in the decision tree shown below. Once Tracy has chosen either the top or bottom branch at X, Amy, who can see what Tracy has chosen, must choose the top or bottom branch at Y or Z. Both players know the payoffs at the end of each branch. 
In the equilibrium this game, Tracy chooses the ________ branch, and then Amy chooses the ________ branch.
A. top; bottom
B. bottom; top
C. bottom; bottom
D. top; top
Answer: B
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Ignoring the government and foreign sectors, there is an unplanned decrease in inventories of $200 billion at the current level of real national income of $12 trillion. From this information, we know that
A) saving equals $200 billion. B) consumption expenditures equal $12 trillion less saving less $200 billion. C) planned investment is $200 billion more than planned saving. D) planned investment is $200 billion less than planned saving.
Consider the market for nonalcoholic beers from the previous question. Which of the following is the Bertrand reaction function for Cudweiser?
a. PC = 1 + .033PB b. PC = 1 - .033PB c. PC = 1.5 + .075PB d. PB = 1.5 + .075PC
Ms. Spring currently earns $100,000 a year, while her junior partner, Mr. Fall, earns $55,000 a year. From the perspective of a utilitarian, if both of their incomes are subject to diminishing marginal utility, taking a dollar from Ms. Spring and giving it to Mr. Fall will
a. increase society's total utility. b. lower Ms. Spring's marginal utility of income. c. increase Mr. Fall's marginal utility of income. d. lower society's total utility.
The table below shows how the marginal benefit of pizza dinners varies for Luigi with the number consumed per month.Dinners per monthMarginal benefit per dinner1$4.002$3.003$2.004$1.00Suppose the price per dinner is $4.99 and accurately reflects the marginal cost of the dinners to Luigi. Assuming that Luigi is rational, he will:
A. consume two pizza dinners this month. B. consume three pizza dinners this month. C. not consume any pizza dinners this month. D. consume one pizza dinner this month.