In a closed economy, the formula for public saving is: Sprivate = T + G + TR
a. True
b. False
Indicate whether the statement is true or false
False
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The fundamental identity of national income accounting implies ________
A) Expenditure = Production + Income B) Expenditure = Production = Income C) Income = Expenditure - Production D) Income = Expenditure / Production E) None of the above
Relative to a competitive situation, if a market lacks competition, economic theory suggests that
a. output will be lower and price higher. b. output will be higher and price lower. c. both output and price will be higher. d. both output and price will be lower.
When is the unemployment rate zero?
A. Right after a recession ends B. Never C. When GDP growth is at its peak D. Right before a recession starts
If a pollution tax imposed on a firm is smaller than the external cost:
A. the externality is completely internalized. B. the social production cost increases by the amount of the pollution tax. C. the pollution tax transfers the full cost borne by people outside the firm back to the firm itself. D. from society's viewpoint, the firm is producing too much.