Forest lives in complete isolation in Montana. He is self-sufficient and feeds himself through hunting, fishing, and farming. Which of the following statements about Forest is true?
A. Forest doesn't have to consider costs and benefits.
B. Forest has to make trade-offs.
C. Forest has unlimited resources.
D. Forest is not required to make trade-offs because he is self-sufficient.
Answer: B
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Refer to the above figure. Which point or points represent(s) a short-run equilibrium?
A) A only B) B only C) C only D) both A and B
Several political leaders have proposed that parents be granted a substantially larger reduction in their annual personal income taxes for each child that they raise. The economic way of thinking indicates that legislation of this type would: a. make it more expensive for parents to provide for their children
b. reduce the value of children to their parents and therefore lead to a reduction in the birth rate. c. reduce the after-tax cost of raising children and therefore increase the birth rate. d. exert no impact on either the cost of raising children or the birth rate since parenting children is a non-economic activity.