Suppose that some teachers have decided that economic and financial uncertainty have made the prospect of retiring more risky, and therefore carry a higher cost than not retiring
By using all available information as they act to achieve their goals, these teachers are exemplifying the economic idea that
A) people are rational. B) people respond to economic incentives.
C) optimal decisions are made at the margin. D) equity is more important than efficiency.
A
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In the late 1990s, aggregate demand was growing rapidly, but productivity grew even more rapidly. What happened to prices and output?
A. output went up a lot, prices went up some B. prices went up a lot, output went up some C. output went down, prices went up some D. both prices and output went down E. both prices and output remain unchanged
Consider two oligopolistic industries selling the same product in different locations. In the first industry, firms always match price changes by any other firm in the industry
In the second industry, firms always ignore price changes by any other firm. Which of the following statements is true about these two industries, holding everything else constant? A) Market prices are likely to be the same in both markets because they are both oligopolistic markets. B) No conclusions can be drawn about the pricing behavior under these very different firm behaviors. C) Market prices are likely to be lower in the first industry where firms always match price changes by rival firms than in the second where firms ignore their rivals' price changes. D) Market prices are likely to be higher in the first industry in which firms always match price changes by rival firms than in the second where firms ignore their rivals' price changes.