What is the economic way of thinking, and why is it important?
What will be an ideal response?
The economic way of thinking provides a framework for analyzing solutions to economic problems. Since economic problems confront all of us much of the time, knowledge of economics will enable one to arrive at better decisions, and enable one to evaluate many public policy questions in a systematic manner.
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Suppose a firm has the following total cost function TC = 100 + 2q2. If price equals $20, what is the firm's output decision? What are its short-run profits?
What will be an ideal response?
Discuss the key criteria for success and the advantages of a central bank adopting the framework of inflation targeting.
What will be an ideal response?
During most episodes of hyperinflation,
A) the inflation rate is high but constant. B) the inflation rate decreases over time. C) the inflation rate increases over time. D) the inflation rate first increases, and then remains constant. E) the inflation rate increases over time, but then rapidly decreases on its own.
Which of the following statements concerning the prisoner's dilemma is TRUE?
A) The player who moves last will always win. B) Confessing is the dominant strategy for both players. C) Neither player will pick the dominant strategy. D) The player who moves first will always win.