Howard has just smoked a cigarette. If he chooses to smoke a second one:
A. he will experience a drop in total utility.
B. he is not acting rationally.
C. he will derive less marginal utility from it than his first.
D. None of these is true.
C. he will derive less marginal utility from it than his first.
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If aggregate expenditure is less than GDP, then inventories rise and GDP falls
Indicate whether the statement is true or false
In 1995–7, tax revenue as a percent of GDP
(a) was roughly equal between developing and developed countries. (b) was a few percentage points higher for developed than for developing countries. (c) was a few percentage points lower for developed than for developing countries. (d) was much higher (approximately double) for developed countries than for developing countries. (e) was much higher (approximately double) for developing countries than for developed countries.
Assume that a consumer's indifference curve is bowed inward and satisfies the other three properties of indifference curves. As the consumer moves from left to right along the horizontal axis, the consumer's marginal rate of substitution
a. increases. b. decreases. c. remains constant. d. increases, then decreases.
Suppose that Brazil has a comparative advantage in coffee and Mexico has a comparative advantage in tomatoes. Which of the following groups would be worse off if these countries specialize and trade?
A. All groups are better off when specialization and trade take place. B. Brazilian coffee producers. C. Mexican tomato producers. D. Mexican coffee producers.