Bonnie gets her hair cut at her usual salon and is very happy with the results. Later that afternoon, she goes to the mall and sees that a hair salon is giving away free haircuts only on that day. If Bonnie does not take advantage of the giveaway, it is because the:
a. marginal utility of the next haircut would be zero or negative.
b. marginal utility of the next haircut would increase.
c. marginal utility of the next haircut would be zero or positive.
d. total utility of both haircuts would be zero or negative.
e. total utility of both haircuts would be higher than just one haircut.
a
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According to Walton and Rockoff, which of the following was the most important in bringing the banking crises of the 1930s to an end?
a. the elimination of many weak banks through bankruptcy (survival of the fittest) b. the promise of federal bank deposit insurance c. New Deal spending programs d. World War II
If economists say that a 7 percent growth in the money supply will increase aggregate demand by 7 percent, they are assuming that velocity
a. will decrease. b. is constant. c. will increase. d. is unpredictable.