Costs that are borne solely by the individuals who incur them are
A. transaction costs.
B. external costs.
C. social costs.
D. private costs.
Answer: D
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According to the real business cycle theory, which of the following is a TRUE statement about the effects of an oil shock in the 1970s?
A) Relative prices changed but there was no impact on the price level in general. B) The natural rate of unemployment remained unchanged, but employment levels did decline. C) The shock shifted the short-run aggregate supply curve but not the long-run aggregate supply curve. D) The shock affected real variables only and did not affect nominal variables.
When the FOMC raises the federal funds rate, almost immediately ________ and a few weeks later the ________
A) short-term interest rates rise; quantity of money and supply of loanable funds decrease B) long-term interest rates rise; quantity of money and supply of loanable funds decrease C) short-term interest rates fall; quantity of money and supply of loanable funds decrease D) long-term interest rates rise; quantity of money and supply of loanable funds increase E) short-term interest rates fall; quantity of money and supply of loanable funds increase
In the absence of government intervention, the marginal social cost of pollution abatement would equal its marginal social benefit
a. True b. False
A trade surplus occurs when:
A. exports exceed imports, so that a country is producing more than it is consuming. B. imports exceed exports, so that a country is producing more than it is consuming. C. imports exceed exports, so that a country is consuming more than it is producing. D. exports exceed imports, so that a country is consuming more than it is producing.