Which of the following is necessary for allocative efficiency to be achieved?
A) Marginal benefit must be maximized.
B) Marginal cost must be minimized.
C) Marginal benefit must equal marginal cost.
D) The difference between marginal benefit and marginal cost must be maximized.
E) Production must be at a point inside the production possibilities frontier.
C
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When the Federal Reserve buys bonds on the open market, it decreases the money supply
Indicate whether the statement is true or false
A Pigouvian subsidy leads to a socially efficient outcome by ________
A) raising individuals' marginal benefit from consumption B) lowering the marginal private cost of production C) raising the marginal external benefit from consumption D) lowering the marginal external cost of production
Which of the following describes a corporate merger?
a. When two firms join to form a new firm b. When one firm buys another firm c. When a firm splits to form two new firms d. When a firm sells part of itself to another firm
Frictional unemployment refers to:
A. people who are out of work and have no job skills. B. short periods of unemployment needed to match jobs and job seekers. C. people who spend relatively long periods out of work. D. unemployment related to the ups and downs of the business cycle.