The sum of the value added by all of a nation's individuals and businesses in a year equals:
A. the value of intermediate products.
B. GDP.
C. the value of investment goods.
D. total profits.
Answer: B
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Which of the following would force a monopoly to charge a lower price?
A) A new firm selling the same enters the market. B) A new firm selling the same product locates close to the monopoly. C) A new firm introduces a better substitute for the firm's product. D) All of the above.
A fundamental axiom of rational choice theory is
A. consumers should be risk-neutral. B. consumers should disregard recent performance data. C. choices should be independent of irrelevant alternatives. D. choices should be independent of relevant alternatives.
When a government influences the exchange rate of its currency, it is said to be practicing “dirty floating.”
Answer the following statement true (T) or false (F)
Refer to the information provided in Table 8.1 below to answer the question(s) that follow.
Table 8.1 
Refer to Table 8.1. Assuming the price of labor (L) is $5 per unit and the price of capital (K) is $10 per unit, which of the following statements is true?
A. The firm will use production technique B to produce the first two units of output and production technique A to produce the third unit of output. B. The firm will use production technique A to produce the first unit and production technique B to produce the second and third units of output. C. The firm will use production technique B to produce all three units of output. D. The firm will use production technique A to produce all three units of output.