Failing to be fully informed may be efficient if information
A) is free.
B) is scarce.
C) is subject to increasing returns.
D) has no opportunity cost of production.
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Fill in the blanks: A change in ________ causes a change in ________ and therefore a change in ________.
A) cost; demand; price
B) price; demand; supply
C) supply; price; demand
D) demand; price; cost
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In the economy of Pandemonia, 500 people have jobs, 500 people are not working but are searching for work, and 1500 people don't work and don't seek work. The unemployment rate is
A) 10 percent.
B) 40 percent.
C) 50 percent.
D) 66 percent.
E) none of the above.
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The Federal Open Market Committee (FOMC) is responsible for managing the nation's
A) domestic economic policy.
B) international trade policy.
C) money supply.
D) gold and silver reserves.
E) wage and retirement policies.
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Which of the following economic activities is ignored in GDP accounts?
A) The market value of medical services
B) The market value of educational services
C) The market value of illegal drugs
D) The market value of prescription drugs
E) The market value of the services associated with used-car dealers
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Fill in the blanks: The percentage of American families with incomes below the poverty line was ________ in 1960 and ________ in 2010.
A) 10.1%; 10.7%
B) 8.7%; 13.9%
C) 18.1%; 11.8%
D) 26.8%; 48.3%
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Prices of microbrewery beer (assume that this is a normal good) have risen steadily in recent years. Over this same period, prices for fermenting vats used in beer making have also risen and consumer incomes have fallen. Which of the following best explains the rising prices of microbrewery beer?
A) The supply curve for microbrewery beer has shifted to the left while the demand curve for microbrewery beer has shifted to the right.
B) The demand curve for microbrewery beer has shifted to the left more than the supply curve has shifted to the left.
C) The demand curve and the supply curve for microbrewery beer have both shifted to the right.
D) The supply curve for microbrewery beer has shifted to the left more than the demand curve has shifted to the left.
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The assertion that income accrues to people as a consequence of interactions among suppliers and demanders
A) amounts to an endorsement of the existing system.
B) amounts to an endorsement of the pattern of income distribution.
C) ignores the fact that the interactions are often unfair.
D) offers a way of approaching the issue of income distribution.
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As applied to voter behavior, the "rational ignorance" hypothesis claims
A) voters will have no incentive to be informed of political issues.
B) voters will stop gathering information once the marginal costs exceed the marginal benefits.
C) voters only vote on the basis of their instinctual or gut feelings.
D) voters are selfish.
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Households in the former Yugoslavia were required to declare the number of radios and television sets they owned, and to pay a monthly tax on each. From the perspective of the free-rider problem, the radio and TV taxes attempted to
A) generate negative externalities on Yugoslav households.
B) generate positive externalities on Yugoslav households.
C) coerce households into paying for the radio and television broadcasts.
D) coerce households into listening less to radio and watching less television.
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