Claire bought a new TV, and the old one sits in her basement untouched. If Claire were rational, what would she do with the old TV?
A. Throw it away because she doesn't really value it anymore.
B. Sell it for its market value, because that is the opportunity cost of having it sit in her basement.
C. Give it away, because it is worth more to someone else than Claire.
D. Either sell it for the value of her new TV or keep it.
B. Sell it for its market value, because that is the opportunity cost of having it sit in her basement.
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As the price of milk increases, what happens at the original equilibrium in the market for cereal that signals market participants that the original equilibrium must change? (Milk and cereal are complements.)
A) A surplus is created by an increase in supply. B) A surplus is created by a decrease in demand. C) A shortage is created by an increase in demand. D) A shortage is created by a decrease in supply.
The economic policy based on the incorrect theory that a nation's economic objective should be to accumulate precious metals in the public treasury is called _____
a. laissez-faire b. deficit financing c. socialism d. mercantilism e. capitalism
The Federal Reserve can tightly control
a. cash in the hands of the public b. cash in the hands of the public and demand deposits c. demand deposits d. funds in savings accounts and checking accounts e. borrowing by the government
The firm's supply curve is made up of the
A. points where MC=MR. B. points where MC=MR, and they make a profit. C. points where MC=MR above the minimum of AVC. D. points where MC=MR, and they make at least breakeven.