If you overheard a farmer discussing his planting plans for the upcoming season, and he said "The price of corn has gone way up. I know I'll have to put some money into fertilizer on the field where I was going to plant soybeans, but it will be worth it this year." This would be consistent with which justification for an upward sloping supply curve
A. diminishing marginal utility?
B. the real-balance effect?
C. increasing marginal cost?
D. the need for higher prices in one good to motivate a shift in production from another?
Answer: C
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There are two grocery stores in the new neighborhood that you have moved into. Because you did not know which store is better, you decided to go to the one that is relatively crowded. Your behavior is an example of ________
A) herding B) anchoring C) signaling D) sniping
Compared with a low benefit reduction rate, a relatively high benefit reduction rate in a cash assistance program:
A. reduces the incentive to work. B. increases the incentive to work. C. does not affect the incentive to work. D. will reduce the incentive to work through the substitution effect but will increase the incentive to work through the income effect.
To maximize profit, a perfectly competitive firm
A) should sell the quantity of output determined by the interaction between industry demand and supply. B) should sell the quantity of output that results in a value for total revenue that is equal to total cost. C) should produce the quantity of output that results in the greatest difference between total revenue and total cost. D) should produce the quantity of output that results in the greatest difference between marginal revenue and marginal cost.
Total federal government spending in 2007 was
a. less than $100 billion b. between $125 billion and $250 billion c. $750 billion d. over $2.8 trillion e. over $12.5 trillion