Balance of payments deficits arise whenever the exchange rate is set at an artificially high level
a. True
b. False
Indicate whether the statement is true or false
True
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The total welfare cost of a monopoly that engages in rent-seeking activities
a. equals only the portion of lost consumer surplus that is not transferred to the monopolist b. includes the use of resources devoted to rent seeking c. equals the total reduction in consumer surplus d. equals the total economic profit earned by the monopolist e. excludes the use of resources devoted to rent seeking
In the case of a negative externality,
A) marginal external costs are greater than marginal private costs. B) marginal external costs are less than marginal private costs. C) marginal external benefits are greater than marginal private benefits. D) marginal external benefits are equal to marginal private costs. E) none of the above
In 2008, during the Great Recession, the federal government provided tax rebate checks to taxpayers in the hope that
A. consumption would decrease. B. government purchases would decrease. C. consumption would increase. D. government purchases would increase.
Using Figure 1 above, if the aggregate demand curve shifts from AD2 to AD1 the result in the long run would be:
A. P4 and Y1. B. P4 and Y2. C. P5 and Y1. D. P5 and Y2.