In the above figure, market equilibrium at point E yields the quantity X. The quantity X? is the socially optimal quantity. Point E indicates that currently there is
A. a public good.
B. a positive externality with subsidy.
C. a negative externality.
D. a positive externality.
Answer: C
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Which of the following will NOT cause a leftward shift in the Long-Run Aggregate Supply curve?
A) a reduction in the amount of capital B) a reduction in government spending C) a reduction in the amount of oil D) a net outflow of human capital
Which of the following is NOT considered a function of money?
A) It facilitates exchange. B) It acts as a means of payment. C) It can be held and exchanged for future goods and services. D) It allows banks to lend out funds.
If the price of gasoline decreases, what will be the impact in the market for public transportation?
A) The quantity of public transportation demanded increases. B) The quantity of public transportation demanded decreases. C) The demand curve for public transportation shifts to the left. D) The demand curve for public transportation shifts to the right.
During the expansion phase of the business cycle
A) employment decreases. B) unemployment increases. C) production increases. D) income decreases.