When the budget line for two goods is just tangent to the highest achievable indifference curve, then _____
a. the consumer is in equilibrium
b. the consumer should purchase more of the good represented on the horizontal axis
c. the consumer should purchase more of the good represented on the vertical axis
d. the consumer cannot afford the combination represented by the tangency point
e. the consumer should purchase less of both goods
a
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Deadweight costs in an exchange are costs
A) charged for free goods. B) imposed by government, such as taxes or safety requirements. C) that have no effect on either the quantity demanded or the quantity supplied. D) that have nothing to do with the sacrifice of valuable opportunities. E) to the buyer that are not simultaneously benefits to the seller.
If a firm is earning a profit, then:
A. the ATC must be higher than the market price. B. total revenue must be higher than total cost. C. the ATC must be higher than AR. D. MR is equal to MC.
Taxes are of interest to
a. microeconomists because they consider how to balance equality and efficiency. b. microeconomists because they consider how best to design a tax system. c. macroeconomists because they consider how policymakers can use the tax system to stabilize economic activity. d. All of the above are correct.
A beggar-thy-neighbor policy is
A. The imposition of trade barriers for the purpose of expanding exports. B. The imposition of trade barriers to increase domestic employment. C. The imposition of import barriers for the purpose of curbing inflation. D. An attempt by a poor country to get more foreign aid and assistance.