When looking at this graph for the welfare effects of a subsidy, which area represents the cost of the subsidy to the government?
a. area a + b + c + d
b. area b + e + f + c + g
c. area f
d. area a + b – c
b. area b + e + f + c + g
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Refer to Table 2-4. Assume Dina's Diner only produces sliders and hot wings. A combination of 40 sliders and 50 hot wings would appear
A) along Dina's production possibilities frontier. B) inside Dina's production possibilities frontier. C) outside Dina's production possibilities frontier. D) at the vertical intercept of Dina's production possibilities frontier.
Total spending by domestic residents, businesses, and governments is called
A) investment. B) net domestic purchases. C) absorption. D) GDP.
If muffins and bagels are substitutes, a higher price for bagels would result in a(n)
a. increase in the demand for bagels. b. decrease in the demand for bagels. c. increase in the demand for muffins. d. decrease in the demand for muffins.
The deficit can be defined in simple terms as
A. tax receipts ? government expenditures + transfers. B. tax receipts + government expenditures + transfers. C. government expenditures + transfers ? tax receipts. D. government expenditures ? transfers ? tax receipts.