Economic models
A) are used to explain how people think.
B) are used to explain how people behave.
C) are essential representations of the real world.
D) are never used for making economic projections or predictions.
B
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The standard view in economics is that tax cuts without ________ will ________ the budget deficit resulting in ________
A) increasing spending; decrease; unemployment B) spending cuts; decrease; unemployment C) increasing spending; increase; crowding out investment D) spending cuts; decrease; crowding out investment E) spending cuts; increase; crowding out investment
The size of the underground economy would tend to decrease if the government of a country
A) increased income tax rates. B) increased business taxes. C) decreased government regulations on businesses. D) made over-the-counter drugs illegal.
If a farmer's opportunity cost of producing 50,000 bushels of wheat is 20,000 fewer bushels of soybeans, then her opportunity cost of producing 50,000 bushels of soybeans must also be 20,000 fewer bushels of wheat
a. True b. False Indicate whether the statement is true or false
Say a public good is provided to two consumers: John and Jill. John's willingness to pay for the good is P = 10 - Q, and Jill's is P = 20 - 2Q. The marginal cost to provide the good are 2Q. Assume the government must pay for providing this good by taxing Jill and John equally to raise the necessary revenue. When the optimal quantity of this good is provided, Jill's willingness to pay for the good is
A. 2. B. 4. C. 12. D. 48.