You participate in a taste test for a new protein supplement called "Kapow." You are given five consecutive one ounce vials of the supplement and after consuming each vial you are asked to note your reaction. You consume the first vial and your response
is: "Hmmm, quite good!" After the second, you say, "Not bad at all." After the third, you note, "It's alright." and after the fourth you wince, "No more, the after-taste is getting to me. I need water." What economic principle does this scenario illustrate? Define the principle.
What will be an ideal response?
It illustrates the law of diminishing marginal utility which states that consumers experience diminishing additional satisfaction as they consume more of a good or service during a given period of time.
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Explain the concept of causation with the help of a simple real-life example
What will be an ideal response?
Feature(s) of the market for corporate control:
a. hostile takeovers b. highly rated bond financing c. managerial capitalism d. related party transactions e. all of the above
A raise in the demand for a resource to produce some product (x) will
a. Raise the cost of using the resource for an alt. product b. Reduce the use of that resource in alt lower valued production c. Increase the value of the resource d. All
If people refused to use banks to create checkable deposits, the banking system would:
A. not be affected in the money creating process. B. not have a way to loan out excess reserves. C. be able to expand the money supply by more than the money multiplier indicates. D. not be able to create new money.