John is trying to decide how to divide his time between his job as a stocker in the local grocery store, which pays $7 per hour for as many hours as he chooses to work, and cleaning windows for the businesses downtown. He makes $2 for every window he cleans. John is indifferent between the two tasks, and the number of windows he can clean depends on how many hours he spends cleaning in a day, as shown in the table below: What is John's opportunity cost of cleaning windows for an hour?
A. $14
B. $2
C. $8
D. $7
Answer: D
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All of the following are considered among the four most important determinants in explaining exchange rate fluctuations in the long run except
A) relative rates of productivity growth across countries. B) preferences for domestic and foreign goods. C) tariffs and quotas. D) interest rates.
A firm cannot control all of the factors that allow it to make economic profits. Which of the following is an example of an uncontrollable factor?
A) hiring competent managers B) input prices C) product differentiation D) producing at a lower average total cost than competing firms
An increase in the price level will: a. make the consumption function flatter. b. make the consumption function steeper
c. increase consumption because wages will increase. d. decrease consumption because falling interest rates make it cheaper to borrow. e. decrease consumption because the value of net wealth will decrease.
Some economists believe that when workers and firms expect a recessionary monetary policy, _____. a. they act so as to prevent the price level from increasing b. their actions lead to a further increase in output c. they are likely to negotiate for relatively lower wages
d. the monetary authority is forced to cancel its planned recessionary policy e. both output and employment increase even more than was originally planned