Inflation is the hardest on those living on fixed incomes
a. True
b. False
Indicate whether the statement is true or false
True
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The figure above shows a nation's production possibilities frontier. If the marginal cost equals the marginal benefit at point A when 4 million pizzas are produced,
A) allocative efficiency is achieved but production efficiency is not achieved because there are no tacos being produced. B) both allocative and production efficiency are achieved. C) production efficiency is achieved but allocative efficiency is not achieved because there are no tacos being produced. D) production efficiency is achieved but allocative efficiency is not achieved because the number of tacos produced is at its absolute maximum. E) neither allocative nor production efficiency has been achieved.
A student wrote: "A subsidy raises marginal social benefit above marginal social cost and eliminates the deadweight loss from underproduction." If you were the instructor, how would you correct this statement?
What will be an ideal response?
If firms do not increase their quantity supplied when price changes, then supply is
A) elastic. B) perfectly inelastic. C) relatively inelastic. D) perfectly elastic.
What constitutes meaningful independence of a central bank?
What will be an ideal response?