The economic way of thinking includes:
A) more attention paid to benefits rather than the costs involved in any choice.
B) the assumption that individuals choose to average out some objective.
C) emphasis on how choices are made at the margin.
D) the notion that the industrialized nations have solved the problem of scarcity.
Answer: C) emphasis on how choices are made at the margin.
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A recession tends to cause the federal budget deficit to ________ because tax revenues ________ and government spending on transfer payments ________
A) increase; rise; falls B) decrease; rise; falls C) increase; fall; rises D) decrease; fall; rises
In the long run, a firm can choose
A) to operate at any point on only one short-run average total cost curve. B) to operate along any short-run average total cost curves. C) to operate along any short-run average variable cost curves. D) to operate along any point of its short-run marginal cost curves.