Focusing on one activity that we do well and relying on others to produce most of the goods and services we want is an application of the concept of ______.
a. externality
b. specialization
c. unemployment
d. productivity
b. specialization
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The economy tends to be more stable with a __________ LM curve causing interest rates to be rather __________ to shifts in the IS curve
A) steeper; sensitive B) steeper; insensitive C) flatter; sensitive D) flatter; insensitive
Governments should tax a market with an inelastic demand if the purpose of the government is to: a. increase its tax revenue
b. discourage the consumption of a good. c. increase the deadweight loss from the tax. d. discourage the production of a good.
LAPD needs to increase the size of its police force, and it will cost them $100,000 per year to recruit two full-time officers. The LAPD should ask the mayor to: a. impose an extra charge on citizens who require extra police protection. b. keep the current force and provide less security
c. hire a private firm to provide extra security. d. increase the tax paid by citizens.
Which of the following is NOT one of the major problems with expanding the EU?
A) Expansion has become a more difficult task because of the unwillingness of the eastern and central European countries to change. B) The programs that target EU expenditures could be stretched thin by the addition of countries with much lower incomes. C) The EU may be faced with an unstable eastern border with huge worker migratory flows if the transition economies fail. D) Most central and eastern European countries have large agricultural sectors and extending subsidies to these countries would entail an enormous flow of funds given the Common Agricultural Policy.