Trinh quits his $80,000-a-year job to become a full-time volunteer at a museum. What is the opportunity cost of his decision?
A) 0 since he will no longer be earning a salary
B) depends on the "going rate" of museum employees
C) at least $80,000
D) the value he attributes to the joy of working at a museum
Answer: C
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Inferior goods are those for which demand increases as
A) the price of a substitute falls. B) the price of a substitute rises. C) income decreases. D) income increases.
If Pete enjoys his first pancake of the morning much more than his fifth pancake of the morning, he is exhibiting
A) utility maximizing behavior. B) diminishing marginal utility. C) irrational behavior. D) diminishing total utility.
Assume that business investment spending rises, and the increase is funded by greater borrowing in the capital markets. If the nation has low mobility international capital markets and a fixed exchange rate system, what happens to the quantity of real loanable funds per time period and current international transactions in the context of the Three-Sector-Model?
a. The quantity of real loanable funds per time period falls and current international transactions become more negative (or less positive). b. The quantity of real loanable funds per time period rises and current international transactions become more negative (or less positive). c. The quantity of real loanable funds per time period and current international transactions remain the same. d. The quantity of real loanable funds per time period rises and current international transactions remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.
Refer to the information provided in Figure 3.6 below to answer the question(s) that follow.
?Figure 3.6Refer to Figure 3.6. The number of DVDs Isabel rents per week increases from 4 to 7. This is caused by
A. a decrease in the price of popcorn, which is a complement to DVDs. B. a decrease in the rental price of DVDs. C. an increase in income if DVDs are a normal good. D. either A or B