The highest valued alternative option that must be given up in order to choose an action is called its
a. utility.
b. opportunity cost.
c. capital.
d. ceteris paribus
B
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Based on the figure below. Starting from long-run equilibrium at point C, an increase in government spending that increases aggregate demand from AD to AD1 will lead to a short-run equilibrium at point ________ creating _____gap. 
A. D; an expansionary B. B; no output C. B; expansionary D. A; a recessionary
In its basic form, an IRA simply does what to taxes?
A) reduces the tax payments when you save B) eliminates them C) defers their payment to a later time D) passes the taxes on to the rich
In the figure above, suppose that the government imposes a tax of $4 per pizza. Then, the
A) buyers and sellers equally share the incidence of the tax. B) shaded area is the deadweight loss from the tax. C) shaded area is the tax revenue from the tax. D) Both answers A and B are correct. E) Both answers A and C are correct.
Pollution is a by-product of some production processes, so on this count real GDP as measured
A) is adjusted downward to take into account the pollution. B) is adjusted upward to take into account the expenditures that will be made in the future to clean up the pollution. C) tends to overstate economic welfare. D) tends to understate economic welfare.