On which point on the graph above should the economy operate if it wants to maximize its future production possibilities?
a. A
b. B
c. C
d. D
a. A
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An example of a Pigovian tax would be a tax on:
A. cigarettes. B. alcohol. C. gasoline. D. All of these are examples.
Which of the following would shift a firm's short-run cost curves downward?
a. an advance in technology b. an increase in employees' wages c. an increase in the demand for the firm's product d. an increase in excise taxes levied on the firm's product
Producer surplus measures the
a. benefits to sellers of participating in a market. b. costs to sellers of participating in a market. c. price that buyers are willing to pay for sellers' output of a good or service. d. benefit to sellers of producing a greater quantity of a good or service than buyers demand.
Using Figure 1 above, if the aggregate demand curve shifts from AD3 to AD2 the result in the short run would be:
A. P3 and Y1. B. P2 and Y1. C. P2 and Y3. D. P1 and Y2.