ECON252 Interim Exam #1 10-03-2013 - PINK

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Unformatted text preview: billion C. $1 billion D. $4 billion E. [None of the above] 17. Which of the following best illustrates the concept that people respond to incentives? A. Many countries that used to rely on central planning now market economies. B. McDonald’s begins paying workers a bonus related to how quickly they serve customers in the drive through lane. As a result, the rate at which McDonald’s workers mess up customers’ orders increases. C. Jordan is offered a position at a different firm, with a 20% pay raise. Jordan accepts the new job. Thus, we know that the marginal benefit of changing jobs was greater than the marginal cost for Jordan. D. Rather than building his own house and his own computer, Tim builds computers for a living and hires a contractor to build his house. 18. The source of the ________ for loanable funds is saving, and the source of the ________ for loanable funds is investment. A. market; supply B. supply; demand C. market; interest rate D. demand; supply E. demand; market 19....
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