Use the idea of external costs to explain why some cities have laws against late-night rock concerts
What will be an ideal response?
While many people might like to see a midnight show featuring AC/DC or Creed, many others argue that a rock concert blaring away early in the morning imposes external costs on many nearby residents who do not want to be disturbed late at night. Therefore regulations on the time that music can be "emitted" are common. To the extent that the regulations are motivated by the externality, such regulations increase efficiency.
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As an economy moves down along a straight line production possibilities frontier, what happens to the opportunity cost of producing the good on the horizontal axis?
A) It remains constant. B) It decreases. C) It increases. D) Above the midpoint it decreases until it equals 1 at the midpoint and then it increases. E) None of these depicts what happens to opportunity cost.
Normative economics is:
a. based on facts b. based on value judgments c. based on the use of the scientific method d. applicable only to macroeconomics
Which statement is true?
A. The marginal cost curve is used to determine if a firm is operating at peak efficiency. B. A firm will always try to maximize its total revenue. C. A firm's long-run supply curve is identical to its entire marginal cost curve. D. A firm is operating most efficiently when it is at its break-even point.
The aggregate expenditure curve tells how much market participants desire to spend at different income levels.
Answer the following statement true (T) or false (F)