Society can produce at a point outside the production possibilities frontier, but only if it is using all of its resources efficiently.
Answer the following statement true (T) or false (F)
False
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When the leisure demand curve is relatively inelastic, the bulk of the burden of a wage tax falls on workers.
Answer the following statement true (T) or false (F)
If traders in a market have rational expectations, then
A) the price of an asset equals its fundamental value. B) prices of riskier assets are higher than prices of less risky assets. C) past prices of assets do not affect market participants' expectations of future asset prices. D) they make use of less information than they would if they had adaptive expectations.
A person’s decision to supply a certain amount of labor in a week is simultaneously a decision to consume a certain amount of leisure per week.
Answer the following statement true (T) or false (F)
In a store that sells souvenirs, suppose an agent receives a $1 commission for each unit sold, and the principal receives the residual profit. As a result,
A) joint profit is maximized. B) the agent will sell until the principal's marginal cost equals $1. C) no agent would enter into such a contract. D) the agent wishes to sell as many units as he can.