The marginal social cost of producing a good or service is the
A) cost of producing an additional unit borne by the producer.
B) cost of producing an additional unit borne by people other than the producer.
C) sum of the marginal private cost and the marginal external cost.
D) same as marginal external cost.
E) sum of the marginal private cost and the marginal external cost minus the marginal social benefit.
C
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In the simple Keynesian cross model with no government or foreign sectors, at the equilibrium level of output
A) saving is less than investment. B) saving is equal to investment. C) saving is greater than investment. D) saving is equal to zero.
Refer to Figure 22.2 below. Suppose that the supply of land is constant at L acres, and Price per acre is $400. In addition, the before-tax demand for land can be characterized by the equation P = 500 - 2L, where L is the acres of land and P is the price.
(A) What is the constant supply of land (L) in the market?
(B) If the after-tax demand curve, P , can be written as P = 400 - 4L, what is P , and how
much tax revenue is generated?
An affordable consumption bundle is an interior choice if:
A. it lies below the budget line. B. for each good, there are affordable bundles containing a little bit more of that good and a little bit less of it. C. for each good, there are no other affordable bundles containing a little bit more of that good and a little bit less of it. D. it exhausts the consumer's income.
If a college student's demand for newspaper subscriptions is more price-elastic than a business executive's demand for newspaper subscriptions, which of the following pricing strategies would a price-discriminating newspaper publisher follow?
A. Set price according to the marginal cost of printing the newspaper B. Charge a higher price to college students C. Charge a higher price to business executives D. Charge the same rate to college students and business executives