Molly just graduated from high school. The figure shows her possibilities frontier. If Molly goes to college, she will move from point M to point K. In terms of consumption goods, Molly's opportunity cost of going to college is

A manufacturer of grenade launchers estimates that the probability of a fatal accident caused by the design of its product is 1/80,000 and the value of a life lost is $2 million

The manufacturer can change the design to eliminate that chance for $20 per grenade launcher and is prepared to incorporate all cost-justified precautions. Will the manufacturer change the design? What would the benevolent social planner think about the manufacturer's decision if the true value of a life is actually $1.5 million?

"Cheap talk" is considered cheap because

A) communications via phone or email these days has a cost that is close to zero. B) a firm can say anything, but may actually do something different. C) the cost of talking is far outweighed by the gains to be made in coordinating efforts. D) firms avoid the costs of hiring lawyers.