Refer to the scenario above. Which of the following is true, if the individual is optimizing in levels?
A) An optimizer will rent the hotel room for three days, if the net benefit of staying for the third day is negative.
B) An optimizer will rent the hotel room for three days, if the cost of staying for two days exceeds the cost of staying for three days.
C) An optimizer will rent the hotel room for three days, if the net benefit of staying for three days exceeds the net benefit of staying for two days.
D) An optimizer will rent the hotel for three days, if the total benefit of staying for three days exceeds the total benefits of staying for two days.
C
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Government spending on interstate highways, public housing facilities, and defense projects are all ways that the president can
a. close a recessionary gap b. close an inflationary gap c. combat inflation d. shift the aggregate demand curve to the left e. reverse the paradox of thrift
Ameritech has a monopoly over local telephone service. If Ameritech is producing where marginal revenue is less than marginal cost, the firm
A. is maximizing profits. B. could increase profits by reducing output. C. must be earning a zero profit. D. could increase profits by increasing output.