Restaurants like to give away free salty peanuts while you wait for your food in order to encourage you to
A. Buy more beverages.
B. Buy expensive salty food on the menu.
C. buy more peanuts at the souvenir shop.
D. None of the choices are correct.
Answer: A
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What is the economic problem? How does a command economy solve the economic problem?
What will be an ideal response?
Economic agents (for example, consumers or firms) often do things that at first glance seem to be inconsistent with their self-interest
People tip at restaurants and when they are on vacation even if they have no intention to return to the same place. Firms, sometimes, install costly pollution abatement equipment voluntarily. How can these deviations from Nash predictions be explained?
If consumers were able to receive the full social benefits associated with the consumption of goods involving positive externalities, other things being equal, there would probably be: a. an increase in consumption
b. a decrease in consumption. c. a greater misallocation of resources. d. a decrease in the market price of the product.
Getting more output from a given amount of inputs is usually the result of increases in
a. the labor force. b. technology. c. the capital stock. d. investment.