In the 1960s, the lyrics of a rock song asked, "Did you ever have to make up your mind to say yes to one and leave the others behind?" What economic principle was demonstrated in the song? Explain
The principle is that of opportunity cost. Selecting one person to date and marry means saying no to all others-at least in societies that prohibit polygamy.
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Suppose Mail Boxes Etc. buys a new copier for its store for $1000. A year later, when the firm wants to upgrade to a new copier, it finds that the old copier is only worth $750. Over the year the copier was used, ________ has occurred
A) replacement investment B) gross investment C) depreciation D) net investment
Physical objects are rival in the sense that ________
A) they are necessarily in opposition to one another B) they are nontrivial C) when they are used in one activity, they cannot be used in another D) some countries possess natural resources, e.g. oil, while some do not
Specialization and the division of labor typically result in
A) cost overruns. B) increased output. C) decreased output. D) a greater reliance upon imports.
____ yields the same results as the theory of perfect competition, but requires substantially fewer assumptions than the perfectly competitive model
a. Baumol's sales maximization hypothesis b. The Pareto optimality condition c. The Cournot model d. The theory of contestable markets e. none of the above