An economy has two workers, Paula and Ricardo. Everyday they work, Paula can produce 4 computers or 16 shirts, and Ricardo can produce 6 computers or 12 shirts. What is the opportunity cost for Paula to produce one computer?
A. ½ shirt
B. 1 shirt
C. 4 shirts
D. ¼ shirt
Answer: C
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In economics, a negotiator who hopes to get an unusually large amount of money for land by refusing to come to terms is called a(n)
A) entrepreneur. B) lobbyist. C) holdout. D) socialist.
The most fundamental concept in economics is that
a. changes in incentives influence behavior in a predictable way--people will be less likely to choose an option as it becomes more expensive. b. changes in incentives generally do not influence human behavior. c. goods that are provided by government are free for society. d. individuals generally do not consider other alternatives when making a choice.
A vertical merger combines firms ______.
a. that sell similar products b. at different stages of production c. that are in different industries d. into a conglomerate
What must happen to the market price in order for a shortage to be eliminated?
A. Price must fall. B. Price must rise. C. Price must stay the same. D. Price may rise or fall depending on the size of the shortage.