Your Best Friend William Tells You That He Is Thinking

question 47

Multiple Choice

Your best friend William tells you that he is thinking of moving back in with his parents now that he has graduated from college. "If I do that for a year or two, I will be able to save my money and get independent much faster than if I try living on my own right away." Since you have read this chapter and know the research into this sort of thing, what would be your best response?

• A) That probably isn't a good idea, because it will actually take you longer to become financially independent if you move back with them than if you live on your own.
• B) That is a good idea, because men who move back in with their parents become financially independent faster, while women who do so take longer to establish such independence.
• C) That is a bad idea, because women who move back in with their parents become financially independent faster, while men who do so take longer to establish such independence.
• D) The research really supports that idea, because both men and women who live with their parents for one to three years while establishing their own career can become financially independent much faster than those who live on their own.

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Definitions:

Price Elasticity

A measure of how much the quantity demanded of a good responds to a change in the price of that good, illustrating the sensitivity of demand to price changes.

Separate Markets

Distinct spaces or platforms where goods, services, or financial instruments are traded independently, often with little to no interaction or effect on each other.

Resold

Refers to an item being sold again after its initial purchase.

Monopolist's Profits

The excess earnings a monopolist achieves, derived from the difference between its revenues and costs, due to its unique market power and lack of competition.