Two ways to postpone diminishing returns are:
a. Increase labor and improve education.
b. Increase all resources together and make the production process more efficient.
c. Actually, there is no way to postpone diminishing returns.
d. Keep the government budget balanced and increase the money supply at a rate that keeps inflation low (e.g., at 2% or whatever the national goal happens to be).
e. Increase the quantity of capital.
.B
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Which of the following is NOT a direct determining factor of consumers' purchase decisions?
A) Consumers' tastes and preferences B) Market price of the finished goods C) Cost of factor inputs D) Consumers' income
Consider two individuals, Kevin and Harris, who discount delayed utilities with a weight of 1/2 and 3/4, respectively
a) Who between the two individuals gives more weight to things that happen in the future? b) If consuming ice cream gives both Kevin and Harris benefits worth 8 utils instantly and has delayed costs of 15 utils, then comment on whether both individuals will want to consume ice cream. c) If the nearby ice cream parlor is closed for a week, will Kevin and Harris prefer to eat ice cream after a week, given that they have to decide today?
Refer to Figure 7-5. If consumers paid the full price of medical services, the equilibrium quantity would be
A) 400. B) 800. C) 1,200. D) > 1,200.
Answer the following statements true (T) or false (F)
1. The ability to produce a good or service at a lower opportunity cost than other producers face is known as comparative advantage. 2. The ability of a nation to gain from specialization and exchange is affected by factors such as shipping costs and exchange rates. 3. One cause for the uneven standard of living throughout the world is the uneven distribution of resources. 4. The application of the principle of comparative advantage requires each of two trading partners to have an absolute advantage over the other in the production of some particular commodity.