One way government can help internalize external benefits is to tax consumption that produces external benefits
Indicate whether the statement is true or false
false
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What is cost-benefit analysis? What are the steps involved in using cost-benefit analysis to make the optimal choice?
What will be an ideal response?
If the marginal propensity to consume is 0.85 and there are no imports or income taxes, the expenditure multiplier is equal to
A) 1 ÷ (1 - 0.85 ) = 1 ÷ 0.15 = 1.45. B) 0.85 × the change in autonomous expenditure. C) 0.85 ÷ 1 = 0.85. D) 1 ÷ 0.85 = 1.176. E) 1 - 0.85 = 0.15.
The market demand curve for loanable funds represents the demand by
a. domestic firms b. domestic firms and domestic households c. domestic firms, households, and governments d. domestic firms and domestic governments e. domestic firms, households, governments, and the rest of the world
Whenever a firm uses input X but not input Y, then at the chosen input combination:
A. MRTSXY ? PX/PY. B. MRTSXY ? PX/PY. C. MRTSXY = PX/PY. D. MRTSXY = -PX/PY.