Other things being equal, a higher price induces
A. buyers to reduce the amount they want to buy and sellers to reduce the amount they are willing to sell.
B. buyers to increase the amount they want to buy and sellers to increase the amount they are willing to sell.
C. buyers to increase the amount they want to buy and sellers to reduce the amount they are willing to sell.
D. buyers to reduce the amount they want to buy and sellers to increase the amount they are willing to sell.
Answer: D
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Behavioral economists examine choices that consumers make that are not economically rational
Economists generally assume that people are rational; that is, they weigh the benefits and costs of an action and choose an action only if the benefits outweigh the costs. Why do consumers not act rationally when the result is that they make themselves worse off?
If you lost 10 percent on $200 worth of stock in a 3x margin account, then you would lose:
A. $60. B. $20. C. $30. D. $40.