A Pigouvian subsidy should be set equal to the amount of the external benefit.
a. true
b. false
Answer: a. true
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Which of the following would not be studied by macroeconomists?
A. The effects of tax cuts on consumer spending. B. Factors affecting average wages in the U.S. economy. C. Inflation in developing countries. D. The worldwide operations of General Motors
If the nominal interest rate is greater than the real interest rate,
A) it is an indication of economic growth. B) inflation must be occurring. C) lenders must lose because they can only make loans using the real interest rate. D) the real interest rate must be negative. E) None of the above answers is correct because it is not possible for the nominal interest rate to exceed the real interest rate.
What is the total cost at the break-even quantity calculated above?
a. $750 b. $850 c. $950 d. $1050
The law of one price works well for ________ traded commodities.
A. heavily B. all C. domestically D. rarely