When attorneys, accountants and other professionals wear expensive clothing, it:
A. does not serve as a credible signal of ability because anyone can wear nice clothes.
B. can serve as a credible signal of ability.
C. is a waste of money because professionals do not need to signal their ability.
D. only serves as a useful signal of ability if they already have well-established reputations.
Answer: B
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For an economy starting at full employment real GDP, an increase in autonomous expenditure results in a(n)
A. increase in full-employment output. B. decrease in full-employment output. C. recessionary output gap. D. inflationary output gap.
Assume a manager of a major league baseball team has a player that is the best pitcheron team the team. However, he decides to to have him play right field instead. It turns out that he is not the best right fielder on the team
How might this manager defend his decision?
All large firms have monopoly power.
Answer the following statement true (T) or false (F)
Which of the following would be considered an implicit cost?
A. Health insurance of employees paid for by the firm B. The water bill of the firm C. The salaries paid to the managers of the firm D. Foregone rent on assets owned by the firm