Walter rents some ice time at the local hockey rink for 2 hours. After skating for an hour, he finds himself cold, tired, and hungry. If Walter decides to skate around for the other hour before leaving, it is likely because he:
A. is ignoring the sunk cost of the rink time.
B. is focusing on the sunk cost of the rink time.
C. is weighing his opportunity costs of the second hour against the benefits of the second hour of skating.
D. None of these is true.
B. is focusing on the sunk cost of the rink time.
You might also like to view...
Allocative efficiency
a. is important for economic theory but not relevant to environmental policy b. calls for the equality of additional benefits and additional costs c. is automatically achieved when cost-effectiveness is achieved d. requires that the total costs to society linked to environmental policy are equivalent to the associated total benefits
Social Security payments:
A. began to be adjusted to 5% above the poverty line in 1987. B. are not adjusted using COLAs. C. are now indexed using the PPI. D. began to be indexed to inflation in 1975.
The amount of gross investment in the economy depends on the
A) response of expected output to the error in estimating the past period's actual output. B) amount of the difference between the desired capital stock and last period's capital stock that can be put in place this period. C) fraction of the capital stock that is replaced each period. D) All of the above are correct.
In the LM curve, the __________ the interest-sensitivity of liquidity preference, the __________ the necessary increase in the rate of interest to restore equilibrium
A) greater; smaller B) greater; greater C) smaller; smaller D) None of the above.