If a good that generates positive externalities were produced and priced to take into account these spillover benefits, then its:
A. price and output would increase.
B. output would increase, but price would remain constant.
C. price would increase and output would decrease.
D. price would increase, but output would remain constant.
Answer: A
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Indicate whether the statement is true or false
Which of the following would increase disposable personal income?
A) a decrease in taxes paid B) a decrease in personal income C) a decrease in transfer payments received D) All of the above would increase disposable income.
Which of the following is an example of an expansionary monetary policy action?
A. Raising the discount rate B. Selling bonds C. Reducing the reserve requirement D. Lowering the prime rate
One suggested policy that industrially advanced nations could adopt to foster economic growth in less developed nations would be to:
A. Leave the responsibility to the World Bank B. Direct foreign aid to the poorest DVCs C. Recruit more skilled workers from DVCs D. Target the banking sector for the most help