The above figure shows the market for steel ingots. What is the total surplus under social optimum?
A) $2500
B) $5000
C) $6500
D) Not enough information.
A
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If the government increases expenditure by $40 billion and increases tax revenues by $40 billion, what is the impact on aggregate demand? Explain your answer
What will be an ideal response?
The coordination task of any economy that answers the question of how output shall be divided among consumers may best be described as
A. output selection. B. production planning. C. distribution. D. input-output analysis.
Which of the following is a correct definition of marginal cost (MC)?
a. It is the added cost that results from hiring one more employee. b. It is the increase in the average cost that results from producing one more unit of a good. c. It is the decrease in profits that results from selling another unit of a good. d. It is the cost per unit of a good produced -- i.e., total cost divided by quantity. e. It is the added cost that results from producing one more unit of a good.
Why might the response of far-sighted consumers reduce the multiplier effect of an increase in government expenditures?