Marginal social cost includes both the marginal private cost and the marginal external cost that production imposes on society
a. True
b. False
A
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If the quantity of money demanded is less than the quantity of money supplied, then the
A) interest rate will decrease. B) interest rate stays the same. C) interest rate will increase. D) effect on the interest rate is indeterminate.
When the economy is at full employment __________ interest rates are __________ by an expansionary monetary policy if inflationary expectations are generated
A) real; decreased B) real; not changed C) nominal; decreased D) nominal; not changed
Consider an investment with the following payoffs and probabilities: State of the Economy Probability Return GDP grows slowly .70 1,000 GDP grow fast .30 2,000 Let the expected value in this example be 1,300 . How do we find the standard deviation of the investment?
a. ? = ? { (1000-1300)2 + (2000-1300)2 } b. ? = ? { (1000-1300) + (2000-1300) } c. ? = ? { (.5)(1000-1300)2 + (.5)(2000-1300)2 } d. ? = ? { (.7)(1000-1300) + (.3)(2000-1300) } e. ? = ? { (.7)(1000-1300)2 + (.3)(2000-1300)2 }
Which of the following statements is not characteristic of a perfectly competitive industry in long-run equilibrium?Ceteris paribus, there is no tendency for firms to either enter or exit the industry. a. A profit-maximizing firm may produce any output level at which P < LRATC. b. Every firm produces at an output level at which MC = LRATC
c. Ceteris paribus, there is no tendency for firms to either enter or exit the industry. d. No firm earns an economic profit.