Which of the following statements is TRUE about the relationship among external, internal and social costs?
A. Social cost is the difference between internal and external costs.
B. External cost is the difference between social and internal costs.
C. Internal cost is the sum of social and external costs.
D. none of these
Answer: B
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If the labor supply curve is upward-sloping, an adverse supply shock causes ________ in employment and ________ in the real wage
A) no change, a decrease B) a decrease, a decrease C) a decrease, no change D) a decrease, an increase E) an increase, an increase
The firm will make the most profits if it produces the quantity of output at which
a. marginal cost equals average cost. b. profit per unit is greatest. c. marginal revenue equals total revenue. d. marginal revenue equals marginal cost.
For the most part, prior to 2008, banks typically held:
A. excess reserves equal to approximately 100% of deposits. B. excess reserves equal to less than 1% of deposits. C. excess reserves equal to between 10 and 20% of deposits. D. absolutely no excess reserves.
Which of the following statements is not true?
A. There is a wage premium for investing in high levels of education. B. The wage premium of men and women college graduates has been increasing over time. C. Better-educated individuals are more productive. D. Public policy initiatives that support on-the-job training have been met with mixed results.