In Figure 5.5, a monopolist would charge which price? 
A. P1
B. P2
C. P3
D. P4
Answer: C
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The figure above shows the market for a good with an external benefit. The efficient level of production is ________ units because ________
A) 8; marginal benefit equals marginal cost B) 8; marginal cost is less than marginal social benefit C) 10; marginal cost equals marginal social benefit D) 10; marginal social benefit exceeds marginal benefit E) 8; marginal benefit equals the marginal external benefit
The international reserves of the Federal Reserve System include its holdings of ________
A) Treasury securities B) discount loans to commercial banks C) foreign currency denominated assets D) U.S. dollars, British pounds and Euros
The calculation of potential output in the United States has been complicated recently by problems in
a. calculating unemployment. b. distinguishing real from nominal income. c. calculating a high-employment, or long-run average, level unemployment rate. d. measuring depreciation and, therefore, net national product.
Assuming a simultaneous reduction in income taxes and transfer payments of $50 billion, then aggregate disposable income will
a. be higher than before. b. be lower than before. c. remain constant. d. None of the above