The false assumption that what is true for a part will also be true for the whole is called the:
A. paradox of thrift.
B. fallacy of composition.
C. post hoc fallacy.
D. ceteris paribus assumption.
Answer: B
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The proportion of income which is earned in the form of wages for labor is currently about
A. 15 percent. B. 35 percent. C. 51 percent. D. 60 percent.
Assume a firm organizes all individuals by their willingness to pay (least to most). If the firm starts to perfectly price discriminate, what is likely to happen?
A) Consumers start to arbitrage amongst themselves. B) The firm's profits will be maximized. C) The firm's costs will be minimized. D) The firm starts to arbitrage with consumers.
The Fed's purchase of U.S. government securities constitutes a(n):
a. contractionary policy because it lowers the amount of total reserves in the banking system. b. contractionary policy because it lowers the amount of excess reserves in the banking system. c. expansionary policy because it raises the amount of total reserves in the banking system. d. expansionary policy because it lowers the amount of total reserves in the banking system. e. expansionary policy because it raises the amount of required reserves in the banking system.
Figure 5-4
Refer to . If the government uses a pollution tax, how much of a tax must be imposed on each unit of production?
a.
$1.90
b.
$1.80
c.
$1.60
d.
$0.30