When Jonathan Ran for Class President, It Never Occurred to Him

question 31

Multiple Choice

When Jonathan ran for class president, it never occurred to him that he could lose. This tendency is known as:

• A) hindsight bias.
• B) the representativeness heuristic.
• C) the availability heuristic.
• D) the overconfidence phenomenon.

Explain how countries benefit from trade even without absolute advantage.

Describe the conditions under which an economy's production possibilities frontier is also its consumption possibilities frontier.

Calculate the opportunity cost of producing different goods.

Analyze the gains from trade between individuals or nations using the production possibilities frontier.

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Definitions:

Average Operating Assets

The average value of the resources used in the operations of a business, calculated over a certain period.

Sales

The total revenue a company generates from selling goods or services to customers.

Stockholders' Equity

The ownership stake of shareholders in a corporation, which is the value of the company's assets minus its liabilities.

Average Operating Assets

An indicator of how efficiently a company is using its assets to generate earnings during a period, calculated as the average of the beginning and ending values of the assets for the time period.