Which of the following statements exemplifies a principle of individual decisionmaking?
a. Trade can make everyone better off.
b. Governments can sometimes improve market outcomes.
c. The cost of something is what you give up to get it.
d. All of the above are correct.
c
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Why do prices have to be based on supply and demand, rather than cost?
A) Costs, unlike supply and demand, are based on subjective factors. B) People cannot be compelled to base prices on costs C) People should be free to set whatever prices they prefer. D) Supply and demand determine costs. E) Because basing prices on costs is less efficient than basing prices on supply and demand.
Full employment occurs when
a. everyone has a job b. everyone who wants a job has one c. there is no frictional unemployment d. there is no cyclical unemployment e. there is no structural, frictional, and seasonal unemployment