All of the following are examples of spending on factors of production in the circular flow model except
A) Bima hires two students to work at his ice-cream store.
B) Iris buys a dozen roses for her mother's birthday.
C) "Get Fit Together" purchases 3 new treadmills for its gym.
D) The Banyan Tree rents a much larger property so that it can add a restaurant to its facilities.
B
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A consumer expenditure survey reports the following information on entertainment spending: 20082009 PriceQuantityPriceQuantityMovies$75$87Concerts$302$352CDs$167$1510 Using 2008 as the base year, by how much does a "cost of entertainment" index increase between 2008 and 2009?
A. 13.4 percent B. 8.6 percent C. 3.9 percent D. 29.4 percent
The following diagram shows the rate of inflation each year during a five-year span. Use this diagram to answer the next question.
How fast did prices rise in Year 2?
A. -2% B. 6% C. 4% D. 2%
A sensible buyer will want to acquire additional information before committing herself as long as the expected value of the information she is gathering
A) is greater than the anticipated value of the purchase. B) is greater than the expected cost of acquiring it. C) will enable her to avoid all mistakes. D) will enable her to avoid possible mistakes she will subsequently regret having made.
The International Maritime Bureau said the waters off Somalia are the world's most dangerous, accounting for nearly a third reported pirate attacks worldwide. Suppose all boats are insured to $100,000 and pay a premium of $15,000 each
Suppose 10 out of 100 boats are attacked by pirates and these 10 file claims with their insurance. Has the insurance company earned an economic profit? A) Yes, they earned an economic profit of $500,000. B) Yes, they earned an economic profit of $50,000. C) No, they sustained an economic loss of $85,000. D) No, they broke even.