If a given production combination is known to be attainable, then it:
A. could be either an inefficient or efficient point.
B. must be an inefficient point.
C. must be an efficient point.
D. must be on the production possibilities curve.
Answer: A
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The imposition of all taxes, except a Pigouvian tax, leads to ________
A) an increase in consumer surplus B) an increase in producer surplus C) a fall in the price of the good D) a loss in total welfare
Which of the following is not a reason for the establishment of intergovernmental transfer programs?
a. Higher level governments want to encourage lower governments to undertake certain programs. b. Taxes are harder to avoid at higher levels of government. c. To provide for national defense resources utilized at the local level. d. Equalization of resources between richer and poorer localities
If purchases power parity exists and the exchange rate is 1.50 u.s. dollars per British pound, then a latte that has a price of $4.00 in Northridge, California, has a price of _ in London, England?
a. 8.00 pounds b. 4.00 pounds c. 6.00 pounds d. 2.67 pounds e. .38 pounds
A firm will make a profit when
A) P > AVC. B) P > ATC. C) P = ATC. D) P = MC.