Which of the following weights on utility (over four periods starting with the current one) provide an illustration of hyperbolic discounting that could well lead to inconsistent choices over time?
a. 1, .5, .25, .125.
b. 1, .25, .0625, .015625.
c. 1, .8, .72, .648.
d. 1, 1, 1, 1.
c
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Two university graduates, Bill and Steve, worked for an advertising agency at an annual salary of $40,000 each for 3 years after they graduated. Then, they decided to quit their jobs and start a partnership that designs and builds Web sites
They rented an office for $12,000 a year and bought capital for $30,000. To pay for the equipment, Bill and Steve borrowed money from a bank at an annual interest rate of 6 percent. During their first year of operation, the partners' total revenue was $100,000. The market value of their capital at the end of the year was $20,000. If Bill and Steve do not design Web pages, their best alternatives are to return to their previous job. a) What is the firm's economic depreciation? b) What are the partnership's costs? c) What is the firm's economic profit in the first year of operation?
Refer to Figure 4-6. What area represents the deadweight loss at the equilibrium price of P1?
A) G + H B) C + E C) C + E + H D) There is no deadweight loss at the price of P1.
Which of the following is an argument against MNCs?
(a) A reduction in inequality. (b) An increase in the use of labor intensive technology. (c) A deterioration of the balance of payments accounts. (d) An increase in government tax revenue. (e) None of the above.
The two types of open market operations are
A) offensive and defensive. B) dynamic and reactionary. C) active and passive. D) dynamic and defensive.