In the above figure, points u, v, y, and z show
A) an inefficient allocation of society's scarce resources.
B) possible combinations of televisions and personal computers.
C) a constant trade-off between televisions and personal computers.
D) that society prefers more televisions than computers.
B
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A baseball player who has signed a long-term contract with his club and then constantly says he is injured and cannot play is an example of ________
A) the principal-agent problem B) marginal returns to work C) the law of diminishing returns D) inefficient hiring practices
Bobby faces two choices. The first is to receive $600 on the spot. The other choice is to receive $800 a year from now. The interest rate is 5% per year. What could a possible explanation for Bobby choosing to receive $600 on the spot?
A) Bobby finds that the present value of the $800 a year from now is less than $600. B) Bobby may have time-inconsistent preferences. C) Although Bobby chooses $600 on the spot, he is actually indifferent between the two options. D) None of the above is correct.