The marginal decision rule will be replaced with the net present value rule when:
a. costs and benefits occur at approximately the same time
b. costs are incurred immediately
c. benefits are incurred immediately
d. the marginal decision rule is never replaced
b
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When the production of a good has a marginal external cost, which of the following occurs in an unregulated market?
i. Overproduction relative to the efficient level will occur. ii. The market price is less than the marginal social cost at the equilibrium quantity. iii. A deadweight loss occurs. A) i only B) ii only C) iii only D) i and ii E) i, ii, and iii
Banks can hold deposits at the Federal Reserve. Balances in these accounts can be used by banks to meet their reserve requirements, but the Fed pays no interest on these deposits
a. True b. False Indicate whether the statement is true or false
"An extra dollar of income gives more additional satisfaction to a poor person than to a rich person." This is an important assumption of which political philosophy?
a. utilitarianism b. liberalism c. libertarianism d. republicanism
If a firm experiences economies of scale as it expands production, then:
a. it is not subject to diminishing returns. b. its marginal cost curve will be downward sloping in that range. c. its marginal product curve will be downward sloping in that range. d. its long-run average total cost curve will be downward sloping in that range.