Answer the following questions true (T) or false (F)
1. The term "market" refers to trading arrangements by which buyers and sellers come together.
2. The additional cost to a producer of hiring an additional unit of labor is called the marginal cost.
3. Marginal benefit refers to the additional benefit that your activity provides to you.
1. TRUE
2. TRUE
3. TRUE
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Suppose an economy is in a steady state, then its saving rate falls, once and permanently. As the economy approaches its new long-run steady state, consumption per worker is ________
A) falling B) rising C) unaffected D) either rising or falling
A tax wedge:
A. refers to the difference in the price the buyer pays and the price the seller keeps. B. only occurs in markets when the tax is placed on sellers. C. only occurs in markets when the tax is placed on buyers. D. only occurs in markets when taxes are placed on large corporations.
Which of the following is least likely to reduce poverty?
A. Redirecting resources within the poor nation away from the military. B. Receiving foreign aid from rich donor countries. C. Raising taxes within the poor nation. D. Receiving aid from private charities or NGOs.
A positive temporary supply side shock will:
A. increase the level of potential output in the long run. B. decrease the price level in the long run. C. increase the price level in the long run. D. have no effect in the long run.