In the loanable funds market, an increase in the desire to save is translated into a(n)
a. increase in investment spending and slower growth in the capital stock
b. decrease in investment spending and slower growth in the capital stock
c. decrease in investment spending and faster growth in the capital stock
d. increase in investment spending and faster growth in the capital stock
e. increase in investment spending but with no growth in the capital stock
D
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The figure above shows the market for coffee. If the government pays the coffee producers a subsidy and production increases to 30 million pounds per day, the market is
A) efficient because the marginal social benefit from the last pound of coffee exceeds its marginal social cost. B) efficient because the total social benefit from coffee exceed the total social cost. C) inefficient because the marginal social benefit from the last pound of coffee exceeds its marginal social cost. D) inefficient because the marginal social cost of the last pound of coffee exceeds its marginal social benefit.
The transactions motive links money demand and
A) interest rates. B) money supply. C) the liquidity trap. D) income.
The pricing rule MR=MC hold for
a. All firms b. Single product firms c. Multiple product firms d. None of the above
The benefits received principle would not work well in which of the following cases?
a. gasoline tax b. national defense c. taxing those people who use a private good d. admission fees to a national park