The Sherman Act had its origins in trust-busting activities.

a.True

b.False

Gerhard and Marta each set a New Year's goal to lose 20% of their body weight by June. They both bought six-month memberships to a gym. Gerhard lost 25% of his body weight in the first four months, but he kept working out at the gym since he had paid for six months of membership. By June, Marta had lost only 10% of her body weight and was frustrated that she had failed to reach her goal. Marta is an example of

a.the sunk cost fallacy, since she paid for a membership but did not achieve her goal.

b.a framing bias, since the gym convinces people that they will reach a goal.

c.overconfidence because she did not realize how hard it would be to achieve a such an aggressive goal.

d.overvaluing the present relative to the future because she was not thinking of the progress she had made.

The budget line is similar to the production possibilities curve in that both show the limits of possible consumption.

a.False

b.True

When wages rise high enough, a substitution effect occurs in which leisure is traded for income.

a.False

b.True

Using the marginal approach, the consumer will choose that combination of goods that yields the lowest possible total utility.

a.False

b.True

It has been suggested that a way to save endangered species is to give hunting rights to people who live in the vicinity of that species. The idea behind this suggestion is that

a.market solutions are morally superior to government solutions.

b.human rights are different from animal rights.

c.the animals will be killed anyway, so the social benefit is extracted from them before they become extinct.

d.by giving people rights to profit from the animals, they have an incentive to ensure their survival.