Consider a housing development built near an existing airport. After the houses are occupied, homeowners complain that the airport imposes a negative externality on them and it should be moved or otherwise limited. Is the airport a negative externality?
A) No, the airport was there first.
B) No, if the original property values reflect the costs imposed by the airport.
C) No, airports are government entities and therefore don't impose costs on individuals.
D) Yes, the airport's noise should be curtailed for the well-being of the homeowners.
B
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An increase in unemployment insurance payments would, in effect, ________ the amount of time spent searching for a job, which would increase ________ unemployment
A) decrease; frictional B) increase; frictional C) increase; cyclical D) decrease; cyclical
In the 2007-2009 period, the expenditure level in the United States intersected the 45-degree line below potential GDP, causing
a. hyperinflation. b. a growing trade deficit. c. a government budget surplus. d. unemployment.
A production possibilities curve measures cost in terms of dollars spent, not in terms of sacrificed alternatives.
a. true b. false
Which of the following statements is false?
A) Regardless of the commodity, the farmer always receives 20 cents of the dollar spent in food. B) The Latin phrase ceteris paribus means everything else the same or holding all other factors constant. C) The rational consumer maximizes satisfaction subject to a budget constraint. D) Agricultural economics is an applied social science.