A fall in prices of imported resources will cause aggregate:
A. demand to increase.
B. supply to decrease.
C. demand to decrease.
D. supply to increase.
Answer: D
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When governments grant patents:
A. producers earn profits that are substantially higher than would occur in a competitive market. B. consumers pay a higher price than they would in a competitive market. C. consumers are likely to pay lower prices than they would in a competitive market. D. both producers earn profits that are substantially higher than would occur in a competitive market and consumers pay a higher price than they would in a competitive market are correct.
Prospect theory:
A. is an alternative to expected utility theory that may resolve a number of puzzles related to risky decisions and was proposed by Daniel Kahneman and Amos Tversky. B. gave puzzling results with respect to risky decisions and was improved by Daniel Kahneman and Amos Tversky's expected utility theory. C. is an alternative to expected utility theory that may resolve a number of puzzles related to risky decisions and was proposed by John Nash. D. gave puzzling results with respect to risky decisions and was improved by John Nash's expected utility theory.
Margarine and butter can both be used as a spread on toast. This means that they are:
a. independent goods. b. complementary goods. c. substitute goods. d. Giffen goods. e. inferior goods.
Suppose Jim and Tom can both produce two goods: baseball bats and hockey sticks. Which of the following is not possible?
a. Jim has an absolute advantage in the production of baseball bats and in the production of hockey sticks. b. Jim has an absolute advantage in the production of baseball bats and a comparative advantage in the production of hockey sticks. c. Jim has an absolute advantage in the production of hockey sticks and a comparative advantage in the production of baseball bats. d. Jim has a comparative advantage in the production of baseball bats and in the production of hockey sticks.