The endowment effect is used to describe the mistake a consumer makes when he or she accounts for the monetary costs of his or her decisions but ignores the nonmonetary opportunity costs.
Answer the following statement true (T) or false (F)
False
The endowment effect occurs when people value something more because they have it already.
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Which of the following definitely results in a product's equilibrium price rising?
A) an increase in both demand and supply B) a decrease in both demand and supply C) an increase in demand combined with a decrease in supply D) a decrease in demand combined with an increase in supply E) an increase in the supply combined with no change in the demand
In the above table, the average total cost of producing 14 units of output is
A) $5.71. B) $6.75. C) $7.00. D) $7.86.
According to William Baumol, many corporate managers engage in empire-building
Indicate whether the statement is true or false
Suppose Bob works for Mary as a proofreader. Mary and Bob fall deeply in love, marry, and have eight children. Bob stops working for Mary in order to care for the children. What will be the effect on GDP?
A) GDP will decrease. B) GDP will increase. C) GDP will not change. D) GDP may increase or may decrease depending on inflation.