Evidence of external costs in the production of a product is present if
A) the price of the product is higher than it should be.
B) the production cost increases because of an increase in the minimum wage.
C) non-buyers and/or non-producers of the product experience a loss for which they are not compensated.
D) buyers refuse to purchase the product.
E) producers pay all of the costs of producing the good or service.
C
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Refer to the above figure. The market equilibrium quantity is Q1. Point Q2 represents the optimal amount of production. The government can achieve the optimal outcome by
A) setting the price at P3. B) providing a per-unit subsidy to consumers equal to P3 - P1. C) providing a per-unit subsidy to consumers equal to P2 - P1. D) establishing a tax equal to P2 - P1 per unit of the good sold.
The ability to produce a good or service at a lower opportunity cost than other producers is
A) absolute advantage. B) comparative advantage. C) opportunity advantage. D) special advantage.
If a country with a large government debt uses money creation to service and repay the debt, this will lead to
a. lower interest rates. b. an appreciation of the nation's currency in the foreign exchange market. c. inflation, higher interest rates, and a financial crisis. d. rapid economic growth, as the expansionary monetary policy stimulates the economy and generates the additional tax revenue to service the larger debt.
Over the period 1900-2014, Brazil's rate of economic growth exceeded that of China
a. True b. False Indicate whether the statement is true or false