One interesting feature of federal government spending in the United States is that:
A. it has historically always been greater than the revenues generated.
B. little of it is discretionary.
C. the majority of it is discretionary.
D. it has historically always been less than the revenues generated, until the last 20 years.
B. little of it is discretionary.
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Using the figure above, suppose with no trade Liz and Joe each produce at point A on their respective PPFs. Then, Joe suggests that they specialize and trade. He would produces only salads and Liz would produce only smoothies
Then, Joe says, he would buy 16 smoothies from Liz at a price of 1.5 salads per smoothie. Liz should A) accept Joe's offer since she will gain 4 smoothies and 4 salads. B) accept Joe's offer as she will be as well off as with no trade. C) not accept Joe's offer as the price he offers is too low for her to gain from trade. D) not accept Joe's offer since she would lose 2 smoothies and 2 salads. E) accept Joe's offer since she will gain 4 salads.
When a monopolist faces a fixed marginal cost of production, profit is maximized if:
a. the slope of the tangent to the total revenue curve is equal to the slope of the total cost curve. b. the slope of the total cost curve is 1. c. the marginal revenue is zero. d. the slope of the tangent to the total revenue curve is equal to the slope of the marginal revenue curve.
Invention is the discovery of a new process or idea. Innovation is
a. the continuing search for inventions. b. copying ideas from rival firms. c. putting an invention to work. d. basic research.
We assume that firms, when they are deciding the best rate of output at which to produce
A) try to get the highest price possible. B) want to maximize sales. C) want to minimize costs. D) want to maximize profits.