Which of the following is a rationale for the government provision of education?
A) Everyone has the right to education regardless of wealth.
B) Students consider only their personal benefits gained from education, but education also benefits the rest of society.
C) No education would be provided in the absence of government provision because everyone would consume it without paying.
D) The cost of providing education for the entire public is too large for the private sector.
E) The government can provide education at a much lower cost than the private sector.
Ans: B) Students consider only their personal benefits gained from education, but education also benefits the rest of society.
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If a natural monopoly is regulated using
A) a marginal cost pricing rule, the firm maximizes its profit. B) an average cost pricing rule, the firm incurs an economic loss. C) a total cost pricing rule, the firm will exit the industry. D) a marginal cost pricing rule, the firm incurs an economic loss. E) an average cost pricing rule, the firm maximizes its profit.
Tax cuts affect only aggregate demand not aggregate supply
a. True b. False Indicate whether the statement is true or false
The monopolistic competitor is ___________ efficient than the perfect competitor.
Fill in the blank(s) with the appropriate word(s).
A movement along the consumption function is the result of changes in
a) the real interest rate b) disposable income c) expected future income d) the price level