Refer to the graph shown. Which price combination is consistent with the budget line shown?
A. $2 per bagel, $2 per croissant
B. $3 per bagel, $2 per croissant
C. $2 per bagel, $4 per croissant
D. $6 per bagel, $3 per croissant
Answer: A
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The inflation rate measures the
A) average price of the goods and services consumed by urban consumers. B) percentage change in the CPI from one year to the next year. C) cost of the CPI market basket at current period prices divided by the cost of the CPI market basket at base period prices. D) percentage change in the quantity of goods and services consumed by urban consumers. E) cost of the CPI market basket at base period prices divided by the cost of the CPI market basket at current period prices.
Economic welfare is generally measured by (i) profit. (ii) total surplus. (iii) the price consumers pay for the product
a. (i) and (ii) only b. (ii) and (iii) only c. (ii) only d. (i), (ii), and (iii)
If the demand for computers increases as consumers' incomes rise, then computers are:
A. a complementary good. B. a substitute good. C. an inferior good. D. a normal good.
If the internal rate of return from an investment is more than the opportunity cost of funds the firm should:
A. not make the investment. B. only make the investment using retained earnings. C. make the investment. D. only make part of the investment and wait to see if interest rates decrease.