While the debate between output and the environment is subjective, all countries should aim to be where on the production possibility frontier?
a. Inside the PPF with allocative efficiency
b. Outside the PPF with allocative efficiency
c. Inside the PPF with productive efficiency
d. On the PPF with productive efficiency
d. On the PPF with productive efficiency
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Antony's Pizza uses the same dough, sauce, and cheese for pizza and calzones. When the price of pizza is low Antony produces more calzones. For Antony, the supply of pizza is ________ compared to the supply at a pizza restaurant that does not serve calzones.
A. higher B. lower C. less price elastic D. more price elastic
Suppose you made a 5% down payment on a house on January 1, 2013, and on January 1, 2014 you decide to sell the house. If the price of your house decreased by 10%, the return on your investment in the house would be
A) -5%. B) -10%. C) -50%. D) -200%.
If a rise in the price x causes less y to be demanded:
a. x and y are gross complements. b. x and y are gross substitutes. c. x and y are net complements. d. x and y are net substitutes.
Refer to the supply and demand graph of Product X below. What would happen if the government taxed the producers of this product because it has negative externalities in production?
A. Supply would increase
B. Demand would decrease
C. Supply would decrease
D. Price would increase