A capital good is
A. a good that should increase in value over time.
B. an intermediate product and therefore not part of GDP.
C. a good that lasts more than three years.
D. a good that is used to make other goods and services.
Answer: D
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Fiona shares an office with her ex-husband. Her share of the rent and utilities is $625 per month. She is considering moving to a home office which she will not have to share with anyone
The home office will not cost her anything as far as extra rent or utilities. Recently, you ran into Fiona at the gym and she tells you that she has moved into her home office. Fiona is as rational as any other person. As an economics major, you rightly conclude that A) Fiona did not have a choice; her ex-husband was a jerk. B) Fiona figures that the benefit of having her own office (as opposed to sharing) is zero, since she is no longer paying rent and utilities. C) Fiona figures that the additional benefit of having her own office (as opposed to sharing) is at least $625. D) The cost of having one's own space outweighs the benefits.
Which type of integration requires adapting domestic policies to coordinate with those of trading partners?
What will be an ideal response?
A country's level of productivity determines its
a. productivity growth rate. b. rate of population growth. c. current standard of living. d. future income potential.
According to the Tiebout hypothesis,
A. under certain conditions, when externalities are present, private parties can arrive at the efficient solution without government involvement. B. an efficient mix of public goods is produced when local land/housing prices and taxes reflect consumer preferences. C. an optimal (or most efficient) level of output exists for every public good. D. a good or service is usually so costly that its provision generally does not depend on whether any single person pays.