Discuss what is necessary to make rational decisions. Be sure to mention opportunity cost, marginal cost, and marginal benefit
What will be an ideal response?
Economists assume that people act rationally, making choices in increments and comparing marginal costs and benefits. Costs are measured as opportunity cost, which is the value of the best thing that must be given u
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In an open-market sale the Federal Reserve ________ government bonds and the supply of bank reserves ________.
A. buys; increases B. sells; decreases C. sells; increases D. buys; decreases
The financial crisis and recession which began in 2007
A) was only severe in the United States. B) impacted only low-income countries. C) had a global impact. D) impacted only high-income countries.
A single-price monopoly causes a deadweight loss because it ________
A) restricts its output so it is less than the efficient quantity B) increases the amount produced beyond the efficient quantity C) maximizes marginal revenue rather than minimizes marginal cost D) increases marginal cost
Suppose TC = 10 + (0.1 ? q2). If p = 10, the firm's profits will be
A) 240. B) 250. C) 260. D) -10 because the firm will shut down.