When marginal utility is positive, total utility is:
A. decreasing.
B. at its minimum.
C. zero.
D. increasing.
Answer: D
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What are the obstacles to achieving an efficient allocation of resources in the market economy?
What will be an ideal response?
The presence of adverse selection:
A. reduces the efficiency of markets. B. increases the efficiency of markets. C. does not affect the efficiency of markets. D. makes the buyer less efficient and the seller more efficient.
Economic freedom is
A. important in leading to positive economic growth. B. a concept in theory since no country has pure economic freedom and therefore cannot be analyzed with respect to economic growth. C. a confusing concept since the more economic freedom residents in a country have the lower the level of economic growth. D. not an important factor in leading to positive economic growth.
Under current tax laws, individuals do not pay taxes on health insurance benefits they receive from their employers. As a result
A) the federal government spends more than it receives in tax revenue. B) individuals are encouraged to want generous health coverage that reduces their incentives to cut costs. C) the quality of health care provided is less than it would be if benefits were taxed. D) politicians are encouraged to raise income and payroll taxes.