If firms were charged the full social opportunity cost of the resources they used, there would be
A. A need for government intervention.
B. Market failure.
C. No external costs.
D. Government failure.
Answer: C
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Which of the following is an example of a positive statement?
A. NCAA Football should have adopted a playoff system 10 years ago. B. An increase in minimum wage results in higher teenage unemployment. C. No oneshould be allowed to carry guns into the classroom. D. Cats are better pets than dogs.
Sarah takes care of her son instead of sending him to a day care which charges $12,000 annually. Which of the following will happen if she puts him into a day care?
A) The country's GDP will increase by $12,000. B) The country's GDP will remain unchanged. C) The country's GDP will decrease by $12,000. D) The country's trade deficit will increase by $12,000.
Refer to Tax Problem. If the government imposes a $10 per unit consumption tax, then how much consumer surplus will there be after the tax.
Consider a perfectly competitive market were demand is Q = 100 - P and Supply is Q = P - 10. a. 600. b. 800. c. 1000. d. 1600.
Real interest rates
a. cannot be negative. b. can be negative only if inflation is negative. c. can be negative only if inflation is zero. d. can be negative only if inflation is greater than zero.