There are ten states in the democratic nation of Katlandia, and each state has ten thousand residents. Although incomes vary, each Katlandian pays a tax equal to the total cost of all government projects divided by the number of residents in the country. Currently, two states each have one army base. An army base adds $2 million to a state's local economy each year. In addition, in terms of increased security, the annual marginal benefit to Katlandia of having an additional army base is shown below. The total cost of an army base is $8 million per year.
The marginal benefit of adding a third army base equals the local marginal benefit of $2 million plus
the marginal benefit to Katlandia of ________.
A. $22.5 million
B. $0
C. $1 million
D. $3 million
Answer: D
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Since 1967, there has not been much change in the income of the bottom 10% of earners in the U.S. economy. This can be attributed to:
A) the adoption of labor-saving technology. B) the cultural and social changes in the economy. C) the adoption of labor-complementary technology. D) the adoption of skill-biased technology by most firms.
There are two basic ways to build up capital: (1) _____ and (2) _____.
Fill in the blank(s) with the appropriate word(s).
Mountain bikers and rollerbladers share the only trail in a city park. The city allows everybody into the park and onto the trail. The mountain bikers say the rollerbladers are a hazard to them; the rollerbladers say it's the other way around. Frequently there are collisions and many injuries occur. Which of the following ways of dealing with the problem does not implicitly grant someone a
property right? a. Allow bikers to use the trail on odd-numbered days and rollerbladers to use it on even-numbered days. b. Allow bikers to use the trail in the morning and rollerbladers to use it in the afternoon. c. Allow only bikers in the park because they have invested in the more expensive sports equipment. d. Kick everybody out of the park. e. Build another trail, put rollerbladers on one and bikers on the other, and give bikers the right-of-way at intersections.
Of the following countries, which grew most slowly, in terms of real GDP per person, over about the last 120 years?
a. Brazil b. Mexico c. China d. United States