Prostitution is legal in Churchill County, Nevada, but a referendum threatened to close two brothels (prostitution businesses) in that county. What idea from Chapter 1 of the text does this story best illustrate?
A. Sunk costs do not matter in making decisions.
B. Microeconomics and macroeconomics are very much interrelated.
C. Social and political forces sometimes rein in market forces.
D. Marginal revenue should equal marginal cost
Answer: C
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The skill-biased character of technological change in recent decades has tended to cause ________
A) a decrease in the demand for college-educated labor B) a higher rate of unemployment among college-educated labor C) a lower rate of unemployment among unskilled labor D) an increase in demand for college-educated labor
If Sally Smith creates VCU1 by playing an online game, the effect is to cause the nation's:
a. Monetary base to rise. b. M2 money supply to fall. c. M2 money multiplier to fall. d. Monetary base to remain the same.