Toby tells you that he prefers hamburgers to hot dogs, hot dogs to tacos, and hamburgers to tacos. This violates what assumption made when analyzing consumer preferences?
A. that there is a diminishing marginal rate of substitution
B. that more is better
C. that consumers are rational
D. This does not violate any assumptions relating to consumer preference.
Answer: D
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When there is an expansionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; expand B. increase; raise; decline C. decline; lower; decline D. decline; raise; decline
Which of the following is fully tax deductible (it is either subtracted or excluded from taxable income) under the current tax system of the United States?
a. out-of-pocket medical expenses b. healthcare insurance purchased through one's employer c. healthcare insurance purchased directly by an individual or family d. all of the above
Explicit costs are costs that:
A. are zero when no output is produced. B. do not depend on the quantity of output produced. C. require a firm to spend money. D. depend on the quantity of output produced.
In an increasing-cost industry, the long-run market supply curve is:
A. positively sloped. B. negatively sloped. C. vertical. D. horizontal.