All else held constant, if the government places a tax on each gallon of gasoline produced, then this would cause a
A. movement down along the current supply curve of gasoline.
B. rightward shift in the current supply of gasoline.
C. leftward shift in the current supply of gasoline.
D. movement up along the current supply curve of gasoline.
Answer: C
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An optimal level of output is one at which marginal profit > 0
a. True b. False Indicate whether the statement is true or false
When the government transfers resources to the poor in the form of a good or service, it is called:
A. Temporary Assistance to Needy Families (TANF). B. a regressive tax. C. the Earned Income Tax Credit (EITC). D. an in-kind transfer.
When an external cost exists in the production of a good, firms tend to
A. over-produce the good. B. keep production constant throughout the year. C. under-allocate resources to the production of the good. D. under-produce the good since society pays these costs.
Refer to the figure below.________ inflation will eventually move the economy pictured in the diagram from short-run equilibrium at point ________ to long-run equilibrium at point ________. 
A. Rising; A B. Falling; A; C C. Falling; B: C D. Rising; A; C