Why is it inefficient to be overinformed?
What will be an ideal response?
Information is costly to obtain. If the marginal cost of obtaining the information exceeds its marginal benefit, the individual would be better off by not obtaining the information. It is inefficient to acquire the information because the marginal benefit from the information does not make up for the marginal cost of obtaining it.
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We measure gross domestic product by multiplying the quantities of goods by their prices because it allows us to
A) calculate the total number of units of goods produced in an economy. B) correct for inflation. C) directly compare the output of one economy to that of another. D) express the values of products in a common unit of measurement.
Because of the relationship among ethanol production, sugar, and corn the authors of your text have concluded that:
a. the corn subsidy is a big problem for ethanol exports. b. the sugar quota makes sugar so cheap in the United States that ethanol producers are using it instead of corn. c. due to the sugar quota and its high price, there is a huge demand for less environmentally friendly corn as a substitute in food products and for ethanol. d. ethanol should be imported rather than exported.