The accompanying figure shows Becky's daily production possibilities curve for dresses and skirts.
Point Y is ________, and point V is ________.
A. inefficient; efficient
B. efficient; efficient
C. inefficient; inefficient
D. efficient; inefficient
Answer: B
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What are three reasons people want to hold money balances?
What will be an ideal response?
The consumption function assumes that:
a. only disposable income affects consumption b. only the price level affects consumption. c. many factors other than disposable income affect consumption, and each is allowed to vary along the consumption function. d. factors other than disposable income affect consumption, but those are held constant along the consumption function. e. only consumer expectations affect consumption.
The particular price that results in quantity supplied being equal to quantity demanded is the best price because it
a. maximizes costs of the seller. b. maximizes tax revenue for the government. c. maximizes the combined welfare of buyers and sellers. d. minimizes the expenditure of buyers.
Prospect theory in behavioral economics predicts that as the price of flour increases, bakeries will try to avoid turning off their buyers by:
A. Increasing the unit prices of their products B. Reducing the unit sizes of their products C. Producing more units of their products D. Passively accepting lower profits