Which of the following is not an example of a systematic mistake that people make?
a. When asked to predict how many movie stars he can list, Ed says 200 but when put to the test he can only name 130.
b. Susan watched a home improvement show in which a contractor installed a faulty deck which collapsed within 2 years of installation. She is now concerned about the safety of her own deck.
c. Kate's manager asks her to work additional hours for which she will be paid her usual hourly wage. Kate weighs the value of her leisure time against the additional wages before responding to her manager.
d. Bill has purchased Skillman tools for years and has recently noticed a decline in quality and durability of Skillman tools. Still, when he needs a new drill, he purchases a Skillman brand drill.
c
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If the marginal rate of technical substitution for a cost minimizing firm is 10, and the wage rate for labor is $5, what is the rental rate for capital in dollars?
A) .5 B) 1 C) 2 D) 10
As more pollution is abated, the total social benefit from pollution abatement increases
a. True b. False