In finance, leverage:
A. multiplies the effect of gains and losses in financial markets.
B. is using borrowed money to pay for investments.
C. helps explain why a crash is so damaging after a bubble bursts.
D. All of these statements are true.
D. All of these statements are true.
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If a firm produces five chairs with marginal costs of $25, $30, $40, $55, and $75, respectively, and sells them for $80 each, what is the firm's total producer surplus?
A) $400 B) $225 C) $175 D) $150 E) $80
Graphically, a change in price causes:
A. a movement along a given supply curve, not a shift. B. the demand curve to shift. C. both supply and demand to shift. D. the supply curve to shift.
In a partnership, debts accumulated by one partner
A. are the responsibility of that partner only. B. are the responsibility of the other partners only up to the amount each partner initially invested in the partnership. C. are the responsibility of the other partners as well. D. are the responsibility of all the employees of the partnership, regardless of whether those employees are partners.
In an experiment that employed the dictator game, economists at Cornell University gave student "allocators" the option of dividing $20 in only two ways (a) $18 for themselves and $2 to another student, or (b) $10 for themselves and $10 to another
student. What was one result from this experiment? A) Most allocators chose to give themselves $18 and $2 to the other students. B) Most of the students who were not allocators did not like having someone else make decisions for them. C) A majority of the female allocators chose option (a); a majority of the male allocators chose option (b). D) Most of the allocators apparently valued acting fairly.