Keith just got an iPhone 5 for his birthday, and he quickly switches his data over and throws his iPhone 4 in a drawer and forgets about it. Economists would say this behavior is ___________ and would use the concept of ________________ to explain this choice.
A. rational; the implicit cost of ownership
B. irrational; the implicit cost of ownership
C. irrational; ignoring sunk costs
D. rational; considering sunk costs
B. irrational; the implicit cost of ownership
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In the long-run equilibrium in monopolistic competition, price equals marginal cost
Indicate whether the statement is true or false
Suppose that the slope of a line tangent to the total cost curve at point X is equal to the slope of a line tangent to the total benefit curve at point X, then:
A. net benefit would be increased by reducing the amount of the activity. B. net benefit would be decreased by reducing the amount of the activity. C. net benefit would be increased by increasing the amount of the activity. D. net benefit is maximized.