Suppose That Tom Bought a Bike from Helen for $195

question 76

Multiple Choice

Suppose that Tom bought a bike from Helen for $195. If Helen's reservation price was $185, and Tom's reservation price was $215, the total economic surplus from this transaction was:

• A)$30
• B)$185
• C)$195
• D)$215

Comprehend the debate on the effectiveness and outcomes of inflation policies.

Analyze the relationship between government debt, fiscal policies, and economic prosperity.

Understand the impact of government debt on future generations and the economy.

Comprehend the effects of tax policies, including consumption taxes and marginal tax-rate reductions, on saving and investment.

---

Definitions:

Extinction

A process in which the conditioned response is weakened when the conditioned stimulus is repeated without the unconditioned stimulus.

Acquisition

The gradual formation of an association between conditioned and unconditioned stimuli.

Spontaneous Recovery

A process in which a previously extinguished response reemerges after the conditioned stimulus is presented again.

Conditioned Stimulus

In classical conditioning, a previously neutral stimulus that, after becoming associated with the unconditioned stimulus, triggers a conditioned response.