Refer to the above figure. The figure gives the payoff matrix for two individuals who are being accused of robbing a bank together. If Bob confesses, what is the best strategy for Harry?
A. Confess.
B. Don't confess.
C. Flip a coin to decide what to do.
D. There is no best strategy.
Answer: A
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All items below will decrease short-run aggregate supply EXCEPT
A) a decrease in labor supply. B) a decrease in training and education. C) a decrease in the marginal tax rates. D) an increase in the prices of inputs.
The belief that the ethically proper thing to do in any situation is the thing that maximizes society's overall happiness and minimizes society's overall suffering is called
A) utilitarianism. B) diminishing marginal utility. C) the benefits-received principle. D) transcendentalism.
Workers and firms both expect that prices will be 2.5% higher next year than they are this year. As a result,
A) aggregate demand will increase by 2.5%. B) the purchasing power of wages will rise if wages increase by 2.5%. C) workers will be willing to take lower wages next year, but not lower than a 2.5 percent decrease. D) the short-run aggregate supply curve will shift to the left as wages increase.
How do economists compute the price elasticity of demand?
a) the percentage change in the price divided by the percentage change in quantity demanded b) the percentage change in income divided by the percentage change in the quantity demanded c) the percentage change in the quantity demanded divided by the percentage change in price d) the percentage change in the quantity demanded divided by the percentage change in income