Refer to the figure above. The triangular region ABC represents the ________
A) deadweight loss due to the presence of a pecuniary externality
B) deadweight loss due to the presence of a negative externality
C) economic loss of not recognizing a positive externality
D) inefficiency created by not recognizing a negative externality
C
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According to the Solow model, given the levels of total efficiency units of labor and technology:
A) efficiency units of labor do not play any role in the determination of steady-state equilibrium level of GDP. B) there is a maximum fixed level of GDP that an economy can achieve by increasing savings. C) increases in the savings rate is the sole reason for sustained economic growth. D) increases in the rate of physical capital accumulation can be the sole reason for sustained economic growth.
A production indifference curve describes the input combinations that will produce a given output.
Answer the following statement true (T) or false (F)
If there is an improvement in technology that affects only Aggregate Supply and a nation's wealth falls due to a sagging stock market, then:
a. Price index rises, and real GDP rises. b. Price index rises, and real GDP falls. c. Price index rises, and the change in real GDP is uncertain. d. Price index falls, and real GDP rises. e. Price index falls, and the change in real GDP is uncertain.
Suppose that everyone prefers to live in a society without poverty. Further suppose that some private charities are successful in reducing poverty. People who do not contribute to the charities
a. receive no external benefit from private antipoverty programs. b. decrease the reliance of individuals on antipoverty programs. c. can free ride on the generosity of others. d. are most likely to be in favor of government-sponsored programs.