There are four lighthouses on the island of Sand. If this is the efficient quantity of lighthouses, ________
A) the marginal social benefit of the fourth lighthouse equals its marginal social cost
B) total social benefit is zero
C) marginal social benefit minus marginal social cost is a maximum
D) Both answers A and C are correct.
A
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Differentiate between the following
a) Normal goods and inferior goods b) Substitutes and complements
Transfer payments exactly replace the income lost because of taxes
a. True b. False Indicate whether the statement is true or false
In the Keynesian aggregate expenditure model, the equilibrium level of income is achieved when
a. actual saving equals actual investment. b. planned aggregate expenditures equal total output. c. consumption equals income times the marginal propensity to consume. d. the marginal propensity to consume equals planned output.
Based on the table demonstrating three tax systems, with these tax rates, which system(s) would bring in the lowest total revenue?
a. progressive
b. proportional
c. regressive
d. both regressive and proportional