The fixed-cost fallacy occurs when
a. A firm considers sunk costs in making decisions
b. A firm ignores relevant costs
c. A firm considers overhead or depreciation costs in making decisions
d. Both a and c
d
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Games with more than three players are generally analyzed using a
A) table. B) payoff matrix. C) graph. D) decision tree.
A teenager plays his radio loudly at the beach. What can we conclude?
A) He creates a negative externality if it unintentionally annoys or upsets others. B) He creates a positive externality if it unintentionally benefits others who enjoy the same music. C) He creates no externality, if others remain unaffected by the music. D) All of the above.
Nathan owns a bakery that bakes only cakes. All of his bakers work 8 hours per day. In 2011, he employed 5 bakers who produced a total of 200 cakes each day. In 2012, he employed 6 bakers who produced a total of 249 cakes each day. The bakery's productivity
a. decreased by 2.33%. b. increased by 2.33%. c. increased by 3.75%. d. increased by 24.50%.
Which of the following statements is equivalent to an appreciation of the dollar relative to the euro?
a. The dollar buys fewer euros now. b. The euro buys fewer dollars now. c. The dollar costs less. d. The euro buys more dollars now