The story in the text about playing tennis outside even though you paid for an inside court illustrates which of the following?
A. Rational choice analysis is what comes naturally to most people.
B. Psychologically, people often do not treat sunk cost as irrelevant to a decision.
C. People will make efficient decisions without knowing what they are doing.
D. All of these are implied by the tennis court story.
Answer: B
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Which of the following is the best definition of openness?
A. The average of imports expressed as a share of GDP. B. The average of goods traded in markets expressed as a share of GDP. C. The average of imports and exports expressed as a share of GDP. D. The average trade balance expressed as a share of GDP. E. The average of exports expressed as a share of GDP.
Which of the following is necessary for a market to be deemed "perfectly competitive"?
A) All firms are price searchers. B) All participants enjoy full and complete information. C) Sellers produce of different quality, durability, and desirability. D) All of the above are necessary. E) None of the above are necessary.
Theoretically, an increase in the real wage
A) increases leisure. B) decreases leisure. C) has an ambiguous effect on leisure. D) has no effect on leisure.
For a monopoly earning positive economic profits at the profit-maximizing output level, all of the following are true EXCEPT
A) P > ATC. B) P > MR. C) P > MC. D) P = MR.