Which of the Following Statements Is Correct

question 117

Multiple Choice

Which of the following statements is correct?

• A)Based on studies of human decision making, most people are overconfident in their own abilities.
• B)Arrow's impossibility theorem disproves the median voter theorem.
• C)Romantic gifts are an example of adverse selection.
• D)An efficiency wage encourages workers to shirk.

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Definitions:

Capital Stock

The total amount of physical goods and financial assets that are used in the production of goods and services in an economy.

Depreciation

The measure of the reduction in value of an asset over time, often due to wear and tear.

Disposable Income

The amount of capital available for household expenditures and savings once income taxes have been removed.

Inventory

The goods and materials that a business holds for the ultimate goal of resale or repair.