The indifference curve in the above figure
A) could illustrate a person's preferences for identical computer disks made by two different companies.
B) could illustrate a person's preferences for right-handed and left-handed gloves.
C) has a marginal rate of substitution that at first decreases and then increases.
D) None of the above statements is correct.
A
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If psychological limitations and other complications cause people to be unable to examine and think through every possible choice available to them and rely instead on rules of thumb, then these individuals exhibit
A) unbounded rationality. B) normative thinking. C) bounded rationality. D) positive thinking.
When unemployment is below the natural rate,
A. frictional unemployment increases. B. inflation slows. C. structural unemployment decreases. D. the inflation rate increases.