Given the economy's existing resources and technology, the only way to enjoy more consumer goods today is to
a. devote more resources to investment goods today.
b. accumulate more capital today.
c. have a slower economic growth rate in the future.
d. devote more resources to consumer goods in the future.
c
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Wilbur Rickhiser, a financial advisor, recently told one of his clients: "The biggest mistake you can make is to hold onto a stock for too long in order to avoid a loss
Let's say you bought a stock for $50 per share but that six months later the price fell to $40 after a poor earnings report. Many of my clients in this situation will hold the stock, hoping the price will later rise above $50. In most cases like this the price does not rise and may even fall. You must know when to cut your losses." Which of the following is the best explanation for Rickhiser's advice? A) People sometimes make mistakes when they buy stocks or when they buy goods and services: they ignore the monetary opportunity costs of their choices. B) People sometimes buy stocks because other people are buying them or they want to appear to be fashionable. C) People sometimes make mistakes when they buy stocks because of the endowment effect. D) People often fail to ignore the sunk costs of their decisions. The cost of the stock bought at $50 per share is a sunk cost.
If a competitive firm cannot earn profit at any level of output during a given short-run period, then which of the following is LEAST likely to occur?
A) It will shut down in the short run and wait until the price increases sufficiently. B) It will exit the industry in the long run. C) It will operate at a loss in the short run. D) It will minimize its loss by decreasing output so that price exceeds marginal cost.
The Bush tax cuts
A. reduced tax rates for the upper brackets and increased tax rates for lower-income taxpayers. B. reduced tax rates for the upper brackets and held constant tax rates for lower-income taxpayers. C. reduced tax rates for the upper brackets and decreased tax rates for lower-income taxpayers. D. held constant tax rates for the upper brackets and decreased tax rates for lower-income taxpayers. E. Increased tax rates for the upper brackets and decreased tax rates for lower-income taxpayers.
Savings is negative below a disposable income of ____________.