With respect to labor supply, the income effect leads a person to want to work more in order to raise his or her income
Indicate whether the statement is true or false
FALSE
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If the marginal social benefit of a city's sewage system is less than the marginal social cost, then the city will achieve an efficient use of resources if it ________
A) decreases the capacity of the sewage system B) does not change the capacity of the sewage system C) increases the capacity of the sewage system D) increases the sewerage charge that the residents pay
The most-favored customer is one who:
a. buys a firm's product regularly. b. is an acquaintance of the owner of a firm. c. is guaranteed to receive the lowest price for a product. d. spends the maximum amount of money on a firm's product. e. has a high purchasing power.
Explain how each of the following could discourage economic growth:
a. The government closes all of the schools so that more people will be available for work. b. The country fears military invasion and spends half of its income on military goods.
In economics, people make decisions regarding consumption based on comparing
A) additional units of satisfaction with additional costs. B) average satisfaction with additional costs. C) average satisfaction with average costs. D) additional units of satisfaction with average costs.